Manchester v. Drivers Management, LLC

• Decision Date: 30 October 2009
• Docket Number: No. S-09-062.,S-09-062.
• Citation: 775 N.W.2d 179,278 Neb. 776
• Parties: Angelina MANCHESTER, appellant and cross-appellee, v. DRIVERS MANAGEMENT, LLC, a Nebraska corporation, appellee and cross-appellant.
• Court: Nebraska Supreme Court

775 N.W.2d 179

278 Neb. 776

Angelina MANCHESTER, appellant and cross-appellee, v. DRIVERS MANAGEMENT, LLC, a Nebraska corporation, appellee and cross-appellant.

No. S-09-062.

Supreme Court of Nebraska.

October 30, 2009.

James E. Harris and Britany S. Shotkoski, of Harris Kuhn Law Firm, L.L.P., for appellant.

Daniel R. Fridrich, of Werner Enterprises, Inc., for appellee.

HEAVICAN, C.J., WRIGHT, CONNOLLY, GERRARD, STEPHAN, McCORMACK, and MILLER-LERMAN, JJ.

NATURE OF THE CASE

MILLER-LERMAN, J.

Appellant, Angelina Manchester, was employed by appellee and cross-appellant, Drivers Management, LLC, as a truck-driver. On January 8, 2006, Manchester was in an accident and suffered injuries to her shoulder and a recurrence of her depression and agoraphobia. The Workers' Compensation Court awarded Manchester temporary total disability (TTD) benefits from January 8, 2006, through July 30, 2007, and penalties and attorney fees. On appeal, the three-judge review panel affirmed the award of benefits but reversed the award of penalties, interest, and attorney fees. Manchester appeals the review panel's reversal of the award of penalties, interest, and attorney fees. Drivers Management cross-appeals, claiming that Manchester was not entitled to an award of benefits. We find no merit to the cross-appeal and affirm the award of benefits. We find merit in the appeal, and we reverse the order of the review panel with respect to penalties, interest, and attorney fees and direct the compensation court to reinstate the award of penalties and attorney fees.

STATEMENT OF FACTS

Manchester has a history of suffering from mental illness, which history has been documented since 2002. In June 2002, Manchester was admitted to a hospital in Boise, Idaho, for a "[m]ajor depressive disorder[,] recurrent." Manchester was hospitalized in a State Hospital in Blackfoot, Idaho, from July 10 through July 25, 2002.

On July 16, 2002, while residing in the State hospital, Manchester applied for Social Security benefits. The Social Security Administration had Manchester examined by a doctor who identified that Manchester suffered from avoidant personality disorder, dependent personality disorder, problems related to the social environment, occupational problems, and problems with access to health care services. On December 19, the Social Security Administration awarded her total disability benefits, and Manchester was found to be totally disabled as of June 1, 2002.

In 2004, Manchester was assessed with recurrent major depression, and with panic disorder, agoraphobia, post-traumatic stress disorder in partial remission, borderline traits, and moderate stressors. In March, her therapist recommended that she obtain a service dog, and within the same year, it was noted that she was becoming more independent with the use of her service dog.

Manchester participated in vocational rehabilitation programs through the Social Security Administration and went to school to become a truckdriver. On December 6, 2004, after finishing her truckdriving program, Manchester was hired by Drivers Management. Manchester's last recorded visit to her doctors for psychological treatment was on December 2.

Manchester drove a truck for Drivers Management from December 2004 until January 8, 2006, without incident. On January 8, 2006, Manchester was westbound on Interstate 84 following another truck when she hit some ice and left the road. Manchester testified that the left side of the truck's tractor came around and hit the truck's trailer. Suffering from a shoulder injury, Manchester was taken to a hospital and was instructed to be off work for 1 week.

On February 3, 2006, Manchester was diagnosed with a shoulder strain, cervical strain, and lumbar strain. The doctor noted that Manchester could return to work with restrictions of no repetitive lifting over 20 pounds, no pushing or pulling over 20 pounds of force, and limited use of the left arm.

On February 6, 2006, Drivers Management fired Manchester because she was in an accident due to negligence. After many visits to doctors concerning her shoulder injury, on June 29 Manchester was informed that she likely suffered from a labral tear, and she was ordered not to drive for work. Manchester had shoulder surgery on August 18. Manchester was to be off work until September 28. Ultimately, Manchester was physically unable to drive a truck until November 21, 2007.

At the same time Manchester was seeking treatment for her shoulder injury, Manchester was seeking treatment for a recurrence of her depression and agoraphobia. In early September 2006, Manchester called her former psychologist, with whom she had not met since December 2, 2004. Manchester told him that she was terminated from work and was falling apart, and he advised her to seek help.

Manchester went to Columbus Psychological Associates, L.L.P., and began receiving treatment from Paul Guinane, Ph. D., on November 7, 2006. In his notes discussing his sessions with Manchester, Guinane noted that Manchester's affect remained flat and that she had a sense of being an unproductive worker. Guinane noted that in addition to her physical pain, Manchester had other stressors in her life, including stress with her boyfriend and the litigation over her workers' compensation benefits.

In a letter dated December 5, 2006, Guinane stated that Manchester suffered from "Major Depressive Disorder" and "Panic Disorder with Agoraphobia." Guinane stated that the two main stressors preventing Manchester from reaching maximum medical recovery in her psychological functions were (1) her constant physical pain related to her work-related injury and (2) the pendency of her legal actions against Drivers Management which have not been resolved.

In January 2007, Manchester enrolled in a community college in Alabama. Ultimately, Manchester dropped out of school because of her severe agoraphobia and depression. In a note by Guinane dated May 15, 2007, he stated that Manchester's agoraphobic symptoms had significantly worsened to the point of forcing her to suspend her studies at college. Guinane noted that Manchester's prognosis would improve once the current stress of her litigation case against Drivers Management ceased. He noted that Manchester should be employable in a field that provides her with significant support and low levels of stress. The trial judge found that the date of maximum medical improvement for Manchester's mental health injuries was July 30, 2007.

Drivers Management paid Manchester benefits from January 8, 2006, until her termination of employment on February 6. Drivers Management contended that it did not owe Manchester benefits from February 7 through August 18, the date of her shoulder surgery, because if Manchester's employment had not been terminated, she could have engaged in light-duty work.

The trial judge awarded Manchester TTD benefits for the period of January 8, 2006, through July 30, 2007. In its award, the trial judge concluded that Manchester was not prohibited from the receipt of workers' compensation benefits simply because she had previously been found by the Social Security Administration to be totally disabled and was receiving Social Security benefits. The court reasoned that Manchester had an earning capacity that she could lose and was, therefore, entitled to workers' compensation benefits. Further, the trial judge found that there was a causal link between the accident and Manchester's psychological injuries. The trial judge awarded Manchester TTD benefits of $544.76 per week beginning on January 8, 2006, and ending July 30, 2007. The trial judge found that Manchester was not totally disabled and did not award permanent benefits. The court did award Manchester $299.44 per week for a 55-percent loss of earning capacity beginning July 31, 2007.

The trial judge also awarded Manchester waiting-time penalties and attorney fees because of Drivers Management's failure to pay Manchester benefits from February 7 through August 18, 2006. The trial judge stated:

If an employer is entitled to a credit against any workers' compensation benefits for payments it would have made to the employee had the employee not been fired, most, if not all employers would fire employees as soon as they suffered an injury in an accident arising out of and in the course of their employment. Such conduct is not acceptable. In this case, as in most cases, the employer has a choice. That choice is to put the employee to work in a light duty position or pay workers' compensation benefits. Termination is not an option.

Drivers Management appealed to the review panel. The review panel affirmed in part and reversed in part. The review panel affirmed the trial judge's determination that there was a causal link between the accident and Manchester's psychological injuries, stating that it was satisfied that the trial judge had a sufficient basis in fact to substantiate, or otherwise justify, the decision reached on causation.

The review panel also affirmed the trial judge's decision that Manchester was not prohibited from receiving benefits simply because she had previously been found totally disabled by the Social Security Administration. The review panel noted that Manchester was gainfully employed at the time of the accident, and it reasoned that she had an earning capacity to lose and that but for the accident, Manchester would likely have been released from her eligibility for Social Security disability benefits through the "Ticket to Work" program.

The review panel reversed the trial judge's award of penalties, interest, and attorney fees. In reviewing the trial judge's award, the review panel observed that the trial judge had concluded that any termination of employment following an accident represented "`conduct [that was] not acceptable'" and triggered penalties against the employer. On appeal, the review panel concluded that this statement of law was...