Liberty Northwest v. Montana State Fund

• Decision Date: 12 November 2009
• Docket Number: No. DA 09-0037.,DA 09-0037.
• Citation: 2009 MT 386,219 P.3d 1267
• Parties: LIBERTY NORTHWEST INSURANCE CORPORATION, Petitioner and Appellant, v. MONTANA STATE FUND, Respondent and Appellee, In re Claim of Gary Mitchell, Claimant/Intervenor and Appellee.
• Court: Montana Supreme Court

219 P.3d 1267

2009 MT 386

LIBERTY NORTHWEST INSURANCE CORPORATION, Petitioner and Appellant, v. MONTANA STATE FUND, Respondent and Appellee In re Claim of Gary Mitchell, Claimant/Intervenor and Appellee.

No. DA 09-0037.

Supreme Court of Montana.

Submitted on Briefs August 5, 2009.

Decided November 12, 2009.

For Appellant: Larry W. Jones, Law Offices of Larry W. Jones, Missoula, Montana.

For Appellee Montana State Fund. Daniel B. McGregor, Montana State Fund, Helena, Montana.

For Intervenor and Appellee Gary Mitchell: Steven S. Carey, David T. Lighthall, Carey Law Firm, P.C., Missoula, Montana.

Justice PATRICIA O. COTTER delivered the Opinion of the Court.

¶ 1 Liberty Northwest Insurance Corporation (Liberty) appeals from a decision of the Workers' Compensation Court (WCC) finding it liable for the low-back condition of Gary Mitchell (Mitchell). We affirm.

FACTUAL AND PROCEDURAL BACKGROUND

¶ 2 On September 2, 1994, Mitchell suffered an industrial injury to his low back in the course of his employment with Washington Construction Company in Missoula, Montana. Montana State Fund (State Fund) accepted liability for Mitchell's industrial injury and paid appropriate medical and wage-loss benefits. On or about January 6, 2006, Mitchell filed a claim with Liberty, alleging that he had suffered an occupational disease (OD) involving his low back while working for Industrial Services, Inc. (Industrial), of Missoula. Industrial was enrolled in Compensation Plan No. 2 of the Workers' Compensation Act (Act) at the time of the alleged injury and was insured by Liberty. Liberty denied liability for Mitchell's claim on February 6 and March 29, 2006.

¶ 3 In May 2006, Mitchell filed a claim with State Fund alleging he had suffered an OD to his low back in 2002 while employed with Environmental Contractors, LLC (Environmental), in Missoula. At the time of the alleged OD exposure, Environmental was enrolled under Compensation Plan No. 3 of the Act and insured by State Fund. State Fund denied liability as well. Both Liberty and State Fund then continued to deny liability for Mitchell's claim, although Liberty paid benefits to Mitchell under a reservation of rights in accordance with Belton v. Carlson Transp., 202 Mont. 384, 658 P.2d 405 (1983), superseded by statute on other grounds as recognized in In Re Abfalder, 2003 MT 180, ¶ 14, 316 Mont. 415, 75 P.3d 1246.

¶ 4 After the denial of his claims, Mitchell filed a claim with the WCC. Mitchell contended that he suffered an OD while working for Industrial and that Liberty was responsible for his workers' compensation claim. The WCC held a trial on July 29, 2008. The WCC received testimony from Mitchell and found him to be a credible witness. The WCC also received sworn statements, depositions, and medical evidence from two doctors who examined Mitchell, Dr. John C. Schumpert (Dr. Schumpert) and Dr. Randale C. Sechrest (Dr. Sechrest).

¶ 5 Mitchell has worked in heavy labor employment his entire life, starting with the logging industry in his teens. Mitchell also worked as a general laborer for several years before becoming an asbestos abatement worker. Mitchell performed abatement work from 1996 through 2005. In 2002, Mitchell worked for Environmental on a job in Virginia. The work involved standing and stooping in awkward positions while applying a liner to the top of a tank. Mitchell's back pain worsened in 2002 and he never recovered to pre-2002 levels. However, he did continue to work.

¶ 6 Mitchell worked as a laborer for Industrial from August 10, 2005, to October 11, 2005. He did not miss a day of work during this time, and worked on a suspension bridge project in Missoula. Mitchell carried lumber, performed concrete work, repaired fences, and performed security duties. Mitchell later testified to the WCC that his back condition worsened during the time he was employed by Industrial from August to October 2005, and he was subsequently unable to work.

¶ 7 Dr. Schumpert performed an independent medical examination (IME) on Mitchell at Liberty's request on February 27, 2006. In his report, Dr. Schumpert concluded that Mitchell's employment with Industrial was not the major contributing cause of Mitchell's low-back condition, but that it was instead attributable to accumulation over 30 years of heavy labor. The objective medical findings upon which Dr. Schumpert based this conclusion included tenderness to palpation over the right posterior and superior iliac spine, right para-lumbar muscles, right gluteal muscles, and spinous processes. Dr. Schumpert also concluded that Mitchell showed evidence of mild-to-moderate loss of range of motion and had a positive Patrick's test on the right with cramping in the gluteal muscles. Dr. Schumpert testified he could "theoretically" assign at least 1% causation of Mitchell's low back to his work at Industrial from August to October of 2005, because he performed heavy-labor job duties. However, Dr. Schumpert could not state to a reasonable degree of medical certainty the exact percentage of causation to assign to Mitchell's employment at Industrial, and further opined that it would be difficult to say which portion of Mitchell's employment history was the primary cause of his low-back condition. Dr. Schumpert did, however, opine that Mitchell's lifetime of employment would be the major contributing cause of his OD.

¶ 8 Dr. Sechrest was Mitchell's treating physician. On August 9, 2007, Dr. Sechrest sent a letter to Mitchell's attorney, opining that Mitchell suffers from an OD because his low-back condition substantially changed during his work with Environmental in 2002. Based on his evaluation of Mitchell's medical history and records, Dr. Sechrest opined that Mitchell's on-going employment from 2002 through October 2005, contributed to some degree to the development of his OD. Dr. Sechrest further opined that Mitchell's employment from August to October 2005 with Industrial contributed, though not very much, to his low-back condition.

¶ 9 In its conclusions of law, the WCC determined that the 2005 version of the Act would apply since both Drs. Sechrest and Schumpert agreed that his work at Industrial in 2005 contributed to his current low-back condition. See Fleming v. Intl. Paper Co., 2008 MT 327, ¶ 27, 346 Mont. 141, 194 P.3d 77. The WCC then considered whether Mitchell was suffering from an OD and the major contributing cause of the OD. The WCC noted that an OD is defined as "harm, damage, or death arising out of or contracted in the course and scope of employment caused by events occurring on more than a single day or work shift." Section 39-71-116(20), MCA (2005). An OD must be established by objective medical findings that the events occurring on more than a single day or work shift are the major contributing cause of the OD in relation to other factors that may contribute to an OD. Section 39-71-407(9)(a) and (b), MCA (2005). A "major contributing cause" is defined as "a cause that is the leading cause contributing to the result when compared to all other contributing causes." Section 39-71-407(13), MCA (2005). Under this standard and in light of the objective medical evidence, the WCC concluded that Mitchell suffered from an OD whose major contributing cause was Mitchell's lifetime of heavy-labor employment.

¶ 10 The WCC then turned to the question of which employer was liable for Mitchell's low-back condition. Under § 39-71-407(10), MCA (2005), "[w]hen compensation is payable for an occupational disease, the only employer liable is the employer in whose employment the employee was last injuriously exposed to the hazard of the disease." The WCC applied this statute to the evidence before it as follows:

While employed by Liberty Northwest's insured from August through October 2005, Mitchell carried lumber, performed concrete work, repaired fences, and performed security duties. Mitchell testified that his back condition worsened during this time. Drs. Sechrest and Schumpert agreed that Mitchell's employment with Liberty Northwest's insured contributed to some degree to his present low-back condition. I therefore conclude that Mitchell was last injuriously exposed to the hazard of his OD at the time of his employment with Liberty Northwest's insured. Pursuant to § 39-71-407(10), MCA, therefore, Liberty Northwest is liable for Mitchell's low-back condition.

¶ 11 Liberty now appeals from the WCC's decision. Liberty asserts that the WCC incorrectly interpreted the applicable workers' compensation statutes, and that there was not substantial credible evidence to support the conclusion that Mitchell was last injuriously exposed to the hazard of his OD while working for Industrial. Both State Fund and Mitchell urge us to affirm. We state the issue presented by this appeal as follows:

¶ 12 Did the WCC apply the correct legal standard in determining when Mitchell suffered his last injurious exposure to the hazard of his occupational disease, and was the WCC's decision supported by substantial credible evidence?

STANDARD OF REVIEW

¶ 13 We review the WCC's findings of fact to determine whether they are supported by substantial credible evidence and its conclusions of law to determine whether they are correct. Lanes v. Mont. State Fund, 2008 MT 306, ¶ 16, 346 Mont. 10, 192 P.3d 1145. Substantial credible evidence is evidence that a reasonable mind might accept as adequate to support a conclusion; it consists of more than a mere scintilla of evidence but may be somewhat less than a preponderance. Lanes, ¶ 16, 192 P.3d 1145.

DISCUSSION

¶ 14 Liberty argues the WCC incorrectly interpreted and applied the 2005 version of the Act in concluding it was liable for Mitchell's OD claim. Liberty contends that the last employer in a series of employers is liable for an OD only if the last employment materially or substantially contributed to the OD. Liberty argues that the WCC erroneously concluded the "last injurious exposure rule"...