Royal State Nat. Ins. Co. v. Labor and Indus. Relations Appeal Bd.

• Decision Date: 28 June 1971
• Docket Number: No. 5014,5014
• Citation: Royal State Nat. Ins. Co. v. Labor and Indus. Relations Appeal Bd., 487 P.2d 278, 53 Haw. 32 (Haw. 1971)
• Parties: ROYAL STATE NATIONAL INSURANCE COMPANY and St. Paul Fire and Marine Insurance Company, Appellants, v. LABOR AND INDUSTRIAL RELATIONS APPEAL BOARD, State of Hawaii, and Robert M. Gushiken, Appellees.
• Court: Hawaii Supreme Court

Page 278

487 P.2d 278

53 Haw. 32

ROYAL STATE NATIONAL INSURANCE COMPANY and St. Paul Fire and Marine Insurance Company, Appellants, v. LABOR AND INDUSTRIAL RELATIONS APPEAL BOARD, State of Hawaii, and Robert M. Gushiken, Appellees.

No. 5014.

Supreme Court of Hawai'i.

June 28, 1971.

Syllabus by the Court

1. HRS § 386-85(1) places on the employer both the burden of going forward with the evidence as well as that of persuasion on the issue whether the employee's claim is for a covered work injury.

2. Under HRS § 386-85(1) the claimant will win unless the employer produces relevant and credible evidence of a quality and quantity sufficient to convince a reasonable man that there exists a noncompensable alternative explanation for the injury.

3. A directed verdict in favor of a defendant may be granted only when after disregarding conflicting evidence, giving to the plaintiff's evidence all the value to which it is legally entitled, and indulging every legitimate inference which may be drawn from the evidence in the plaintiff's favor, it can be said that there is no evidence to support a jury verdict in the plaintiff's favor.

4. HRS § 386-3 reflects the policy of the Workmen's Compensation Law that an employee should be indemnified for all infirmities resulting from his employment.

5. The humanitarian purposes of the Workmen's Compensation Law require that indemnification be predicated not upon the label assigned to the injury received, but upon the employee's inability to work because of impairments flowing from the conditions of his employment.

6. An employee suffers a work-related injury within the meaning of HRS § 386-3 when he sustains a psychogenic disability precipitated by the circumstances of his employment.

Donald A. Beck and Edward C. Kemper, III, Cades, Schutte, Fleming & Wright, Honolulu, for appellants.

Raymond J. Tam, Ikenaga & Tam, Honolulu, for appellees.

Before RICHARDSON, C. J., MARUMOTO, ABE, and LEVINSON, JJ., and Circuit Judge LANHAM in place of KOBAYASHI, J., disqualified.

LEVINSON, Justice.

This case involves a workmen's compensation claim filed by the appellee, Robert M. Gushiken, on September 16, 1965. Mr. Gushiken is seeking compensation for: (1) alleged physical injuries incurred in an automobile accident which took place on January 28, 1965; and (2) mental injuries allegedly resulting from the aforementioned accident or from the stress and strain of his occupation, or from a combination of the two. At the time of the accident the appellee was employed by the appellant, Royal State National Insurance Co., to train prospective insurance agents. On Jauary 28, Mr. Gushiken had left the company's premises to collect an overdue insurance premium. During the course of his journey his vehicle was struck on the left rear bumper by a service station jeep. The appellee described the accident as minor. Nevertheless on the following day he saw a physician because of neck pains.

During the months following the accident the appellee came into conflict with his supervisor who, on April 7, 1965, recommended to the company's agency committee that Gushiken be dismissed from his position as director of training. In a meeting attended by the appellee the agency committee voted to dismiss him, effective immediately. Following the meeting Gushiken visited his physician and was treated for neck pains. On the same day he was admitted to St. Francis Hospital, where he remained until April 18, 1965. On the morning of that day Gushiken unsuccessfully tried to commit suicide by slashing his wrists with a razor blade, as a result of which he was transferred to Queen's Hospital. There is he received treatment until May 28, 1965 when, against the advice of his doctor, he released himself from the hospital's care.

The appellee's claim for compensation was denied by the Administrator of the State Department of Labor and an appeal was taken to the Labor and Industrial Relations Appeal Board. On October 11, 1968, the appeal board reversed the decision of the administrator and allowed the appellee's claim. The employer-appellant then appealed to the First Circuit Court, where a jury trial was begun on April 27, 1970. At the end of the appellant's case in chief the trial judge granted the appellee's motion for a directed verdict on the ground that the appellant had failed to prove, as a matter of law, either that the appellee's claim was not for a covered work injury, or that his injuries were willfully inflicted. On May 26, 1970 judgment was entered in favor of the appellee.

On appeal the appellant argues: (1) the trial court erred in directing a verdict in favor of the appellee; and (2) the trial judge's conduct during the proceedings deprived the appellant of its right to a fair trial. After a careful reading of the record we find that the appellant's second contention is without merit. We do agree, however, that the judgment must be reversed in part because on the issue of the appellee's physical injuries the trial court improperly withheld the case from the jury's consideration.

In directing a verdict in favor of the appellee the trial court held that the appellant had failed to rebut the statutory presumption, created by HRS § 386-85(1), that the appellee's claim was for a work injury covered by the Hawaii Workmen's Compensation Law. This presumption provides in relevant part:

In any proceeding for the enforcement of a claim for compensation under this chapter is shall be presumed, in the absence of substantial evidence to the contrary:

(1) That the claim is for a covered work injury.

This provision places on the employer both the burden of going forward with the evidence as well as that of persuasion. Acoustic, Insulation & Drywall, Inc. v. Labor & Industrial Relations Appeal Board, 51 Haw. 312, 316, 459 P.2d 541, 544, rehearing denied, 51 Haw. 632, 466 P.2d 439 (1970). Thus the claimant will win unless the employer produces 'relevant and credible evidence of a quality and quantity' sufficient to convince a reasonable man that there exists a non-compensable alternative explanation for the injury. Acoustic, Insulation & Drywall, Inc. v. Labor & Industrial Relations Appeal Board, supra. The trial court held that as to each of the injuries alleged by the appellee, the appellant had failed, as a matter of law, to meet this burden. We believe that with respect to the appellee's physical injuries the trial court erred in this holding.

I. THE STANDARD TO BE APPLIED IN DIRECTING A VERDICT

In Stewart v. Budget Rent-A-Car Corp., 52 Haw. 71, 77, 470 P.2d 240, 244 (1970), this court laid down the standard to be applied by a trial judge in determining the appropriateness of a directed verdict.

A directed verdict may be granted only when after disregarding conflicting evidence, giving to the plaintiff's evidence all the value to which it is legally entitled, and indulging every legitimate inference which may be drawn from the evidence in plaintiff's favor, it can be said that there is no evidence to support a jury verdict in his favor.

Under this standard the court is not to weigh the evidence in considering the motion for a directed verdict. This is the province of the jury. The trial court merely determines the narrow question whether there is any evidence upon which a jury could properly proceed to find a verdict favorable to the party proceed to find a motion. If such evidence exists then the motion must be denied. We now proceed to examine the evidence in the present case to ascertain if, when viewed most favorably to the appellant, it would support a judgment that the appellee's physical and mental injuries were non-compensable under the Workmen's Compensation Law.

II. THE APPELLEE'S PHYSICAL INJURIES.

In the court below the parties stipulated that the appellee's medical records, compiled by the St. Francis and Queen's hospitals, should be admitted into evidence. Neither of the parties placed any limitations upon the evidentiary purposes of these records. On appeal the appellant contends that the diagnostic opinions expressed in the hospital records rebut the presumption that the appellee suffered neck injuries as a result of the January 28 automobile accident.

The appellant directs attention to the April 17, 1965 report of the consulting neurological specialist, Dr. William Won, who after examining the appellee for cervical pain, stated: 'He appears to feign much of his illness, and I am not convinced that he has actual pain in the areas that he describes.' Based on this evidence, we agree with the appellant that a jury might properly refuse compensation because the appellee's neck injuries were fabricated. ¹ Therefore, a directed verdict on this issue was improper.

III. THE MENTAL INJURIES SUFFERED BY THE APPELLEE.

A. Mental Disabilities Arising Out of the Course of Employment are Compensable Under the Hawaii Workmen's Compensation Law.

We now turn to the mental collapse suffered by the appellee during his hospitalization at St. Francis Hospital. At the time of his collapse the appellee's condition was described by his physician as schizophrenia with suicidal tendencies. The physician's report states that this condition developed from anxiety depression 'much attributed to business pressure.' The...