Opinion
2022 CA 0455.
11-04-2022
Harry S. KILBOURNE v. DIXON CORRECTIONAL INSTITUTE.
LANIER, J.
The Office of Workers' Compensation, District 5 (OWC) rendered judgment in favor of the appellee, State of Louisiana, Department of Public Safety and Corrections, Dixon Correctional Institute (Dixon), denying attorney's fees and penalties to the appellant, Harry S. Kilbourne, and dismissing his disputed claim for compensation with prejudice. For the following reasons, we affirm.
FACTS AND PROCEDURAL HISTORY
On May 2, 2014, Mr. Kilbourne was involved in an automobile accident during the course and scope of his employment as a prison guard with Dixon. According to his disputed claim for compensation, Mr. Kilbourne was a passenger on a prison bus on I-10 in Baton Rouge when the driver rear-ended another vehicle. Mr. Kilbourne underwent surgery on his left shoulder due to his injuries. Mr. Kilbourne received wage benefits until January 26, 2020, when Dixon allegedly terminated the benefits based on the independent medical examinations (IME) of Drs. Alpesh Patel and Robert C. McMyne, Jr., which released Mr. Kilbourne to return to full duty. Mr. Kilbourne gave notice of disagreement with the termination on January 27, 2020, stating specifically that Dr. McMyne's IME, which took place on December 6, 2019, was inconsistent with his treatment and symptoms.
Mr. Kilbourne filed a disputed claim for compensation on February 18, 2020, in which he requested interest, penalties, costs, and attorney's fees. On May 14, 2020, Dixon requested a preliminary determination by the OWC of the allegations in the disputed claim for compensation. On May 28, 2021, the OWC made the preliminary determination that termination of temporary total disability (TTD) benefits made by Dixon on January 26, 2020 was not arbitrary and capricious, or without probable cause; however, the OWC also ruled that Mr. Kilbourne was due supplemental earnings benefits (SEB) from January 26, 2020 until June 7, 2020, and ongoing TTD benefits from July 8, 2020.
Trial was held on June 13, 2021. In a judgment signed July 20, 2021, the OWC found that the "safe harbor" provision of La. R.S. 23:1201.1 was applicable to Dixon, that no penalties or attorney's fees were due, and that two checks issued by Dixon and made payable to Mr. Kilbourne were issued timely. The OWC dismissed Mr. Kilbourne's disputed claim for compensation with prejudice. The OWC granted Mr. Kilbourne's request for a devolutive appeal in an order signed on July 29, 2021.
The applicable "safe harbor" provision of La. R.S. 23:1201.1 states, in pertinent part:
K.(2) Any employer or payor who accepts and complies with the workers' compensation judge's determination within ten calendar days, shall not be subject to any penalty or attorney fees arising out of the original notice which was the subject of the preliminary hearing.
ASSIGNMENTS OF ERROR
Mr. Kilbourne alleges the following assignments of error:
1. The OWC erred in determining that Dixon accepted the preliminary determination.
2. The OWC erred in finding that Dixon complied with the preliminary determination within ten business days.
3. The OWC erred in determining that the back benefits paid to Mr. Kilbourne satisfied the indemnity arrearages.
4. The OWC erred in determining that Dixon was entitled to the "safe harbor" protections found in La. R.S. 23:1201.1.
5. Dixon failed to pay a final judgment of the OWC by failing to pay interest due on each indemnity installment from the time due until paid.
6. Mr. Kilbourne is entitled to additional attorney's fees for the preparation and work on the instant appeal.
STANDARD OF REVIEW
The factual finding of whether a claimant is entitled to TTD benefits is subject to the manifest error or clearly wrong standard of appellate review. New Line Environmental and Canal HR v. Davis, 2015-1885, 2015-1886 (La. App. 1 Cir. 10/7/16), 205 So.3d 921, 925, writ denied, 2016-1996 (La. 12/16/16), 211 So.3d 395. The crucial inquiry is whether the employer has an articulated and objective reason for discontinuing benefits at the time it took the action. Id., at 928. The workers' compensation court's determination of whether an employer or insurer should be cast with penalties and attorney's fees is essentially a question of fact and is also subject to the manifest error or clearly wrong standard of review. Id.
DISCUSSION
The Louisiana Workforce Commission mailed notice of the preliminary determination to Dixon on May 28, 2021. The notice, with a copy of the preliminary determination attached, ordered Dixon to either accept the preliminary determination by mailing a revised notice of payment to Mr. Kilbourne (as well as any due payments), or notify Mr. Kilbourne in writing that it did not accept the preliminary determination and request a trial date with the OWC. Either action had to be taken by Dixon within ten calendar days of the mailing of the notice of the preliminary determination. Counsel for Dixon received the notice via certified mail on June 1, 2021, which was within ten days of the notice's mailing.
The notice of preliminary determination is pursuant to La. R.S. 23:1201.1(K), which states, in pertinent part:
(1) The employer or payor shall, within ten calendar days of the mailing of the determination from the workers' compensation judge, do either of the following: (a) Accept and comply with preliminary determination of the workers' compensation judge regarding the payment, suspension, modification, termination, or controversion of benefits and mail a revised "Notice of Modification, Suspension, Termination, or Controversion of Compensation and/or Medical Benefits" to the injured employee or employee's representative, along with any payment amount determined, and any arrearage due.
(b) Notify the injured employee or his representative in writing that the employer or payor does not accept the determination.
On June 3, 2021, Dixon mailed to Mr. Kilbourne a notice of modification of his benefits. The notice stated that Mr. Kilbourne would receive TTD benefits in the amount of $619.00 per week, from January 27, 2020. The notice gave no indication of an award of SEB. However, along with the notice, Dixon attached a check in the amount of $42,030.10 payable to Mr. Kilbourne. The check's description indicates "Supplemental Earn/No PPD (LA)," and includes the dates January 20, 2020 to May 12, 2021. Receipt of the check was signed by Mr. Kilbourne's counsel on June 7, 2021. On June 4, 2021, Dixon sent another check payable to Mr. Kilbourne in the amount of $2,476.00, described as "Supplemental Earn/No PPD (LA)," from May 13, 2021 to June 9, 2021. The check's envelope is postmarked June 5, 2021 and noted as "Received 6/8/2021."
At trial and in his brief, Mr. Kilbourne argued that the second payment was delivered on the eleventh calendar day after the notice of the preliminary determination, and therefore Dixon had not complied with the preliminary determination. We disagree. The envelope containing the second check was postmarked within ten calendar days of the notice of the preliminary determination. Although Mr. Kilbourne received the check eleven days later, the mailing of the check was timely.
The evidence presented at trial provides that TTD benefits were paid from January 27, 2020, although the preliminary determination required payment of TTD from July 8, 2020. The two checks, which are described as supplemental earnings, cover a timespan beginning January 20, 2020, and ending June 9, 2021. The dates of SEB ordered by the preliminary determination fall within that timespan. Based on the evidence presented, we find that the payments made by Dixon to Mr. Kilbourne satisfied the arrearages.
Likewise, Dixon is not liable for interest on the arrearages. Louisiana Revised Statutes 23:1201.3, which Mr. Kilbourne claims entitles him to interest on the arrearages, applies only if the payment is not made within ten calendar days after it becomes due. Since we find Dixon timely paid the arrearages, we also find that Mr. Kilbourne is not owed interest.
Louisiana Revised Statutes 23:1201.3 states, in pertinent part:
A. If payment of compensation or an installment payment of compensation due under the terms of an award, except in case of appeals from an award, is not made within ten days after the same is due by the employer or insurance carrier liable therefor, the workers' compensation judge may order a certified copy of the award to be filed in the office of the clerk of court of any parish, which award whether accumulative or lump sum, when recorded in the mortgage records, shall be a judicial mortgage as provided in Civil Code Article 3299. Any compensation awarded and all payments thereof directed to be made by order of the workers' compensation judge shall bear judicial interest from the date compensation was due until the date of satisfaction. The interest rate shall be fixed at the rate in effect on the date the claim for benefits was filed with the office of workers' compensation administration.
Mr. Kilbourne also argues in his brief that the preliminary determination explicitly stated that the termination of TTD benefits was not arbitrary and capricious; however, since the preliminary determination is silent as to whether termination of SEB was arbitrary and capricious, Dixon was therefore arbitrary and capricious for terminating SEB and should be cast with penalties and attorney fees. Again, we disagree.
First, the absence of an explicit finding by the OWC that Dixon's termination of SEB was arbitrary and capricious does not mean that the OWC implicitly found that it was. Furthermore, arbitrary and capricious behavior is willful and unreasonable action, without consideration and regard for the facts and circumstances presented. J.E. Merit Constructors, Inc. v. Hickman, 2000-0943 (La. 1/17/01), 776 So.2d 435, 437-438 (per curiam). An award of attorney's fees in a workers' compensation case is essentially penal in nature, as it is intended to discourage indifference and undesirable conduct by employers and insurers. Id., at 438. Attorney's fees should not be imposed in doubtful cases, where a bona fide dispute exists as to the employee's entitlement to benefits. Id.
Dixon's January 26, 2020 termination of benefits relied upon Dr. McMyne's IME of December 6, 2019. Dr. McMyne's examination was the last one before the termination of benefits. In that IME, Dr. McMyne conducted his own examination of Mr. Kilbourne, as well as reviewed Mr. Kilbourne's past medical history. During his examination of Mr. Kilbourne, Dr. McMyne noted that Mr. Kilbourne had "very exaggerated responses and overreaction" and exhibited "somewhat poor effort" to the tests he conducted, resulting in the exam being "somewhat limited."
In his review of Mr. Kilbourne's medical record, Dr. McMyne noted the observations of previous physicians, including the IME conducted by Dr. Patel on June 27, 2019. Dr. Patel diagnosed Mr. Kilbourne's chronic lower back and neck pain as degenerative disc and joint disease. According to Dr. Patel, there is "no causal relationship between Mr. Kilbourne low back pain complaints and the injury while at work." Dr. Patel concluded that Mr. Kilbourne had reached maximum medical improvement (MMI). In his own conclusion, Dr. McMyne agreed with Dr. Patel's conclusion that Mr. Kilbourne had reached MMI, and that his back pain was more consistent with his degenerative diseases rather than the work-related accident.
At trial, Mr. Kilbourne presented as evidence the medical report of Dr. Joseph W. Turnipseed, who is Mr. Kilbourne's own pain management physician. Dr. Turnipseed's examinations occurred after Mr. Kilbourne's benefits were terminated. The records indicate examination and treatment for Mr. Kilbourne's symptoms, but offer no conclusion as to causation or relationship with the work-related accident. Mr. Kilbourne also presented as evidence Dr. Turnipseed's deposition, dated July 15, 2020. In the deposition, Dr. Turnipseed stated that as of Mr. Kilbourne's last visit with him, which was in July of 2020, Mr. Kilbourne was not capable of doing any work. Dr. Turnipseed did not state in the deposition whether Mr. Kilbourne's symptoms were related to his accident on May 2, 2014.
Given the evidence presented for the preliminary determination and at trial, we cannot say that the termination of Mr. Kilbourne's benefits was arbitrary or capricious. Dixon's decision was based on Dr. McMyne's IME, which stated that Mr. Kilbourne's back and neck pain were not caused by the work-related accident. In rendering its preliminary determination, the OWC had no basis to believe that the termination of either the TTD benefits or SEB was arbitrary or capricious. Likewise, at trial, the OWC was not manifestly erroneous in finding that no penalties or attorney fees were due pursuant to La. R.S. 23:1201.1. See Stobart v. State through Dept. of Transp. and Development, 617 So.2d 880, 882 (La. 1993).
Lastly, we find Mr. Kilbourne is not entitled to additional attorney fees in his preparation of the instant appeal. Generally, an increase in attorney fees should be awarded when a party who was awarded attorney fees in the trial court is forced to and successfully defends an appeal. Champagne v. State, Louisiana State University, 2001-0242 (La. App. 1 Cir. 3/28/02), 819 So.2d 1059, 1066. Mr. Kilbourne was not awarded attorney fees by the OWC, and was not forced to prepare a response to an appeal filed by Dixon. Mr. Kilbourne is the appellant, and under these circumstances, we find that additional attorney's fees for services on an appeal Mr. Kilbourne filed are not warranted. See Burgess v. City of Baton Rouge, 477 So.2d 143, 147 (La. App. 1 Cir. 1985).
DECREE
The judgment of the Office of Workers' Compensation, District 5, rendered in favor of the appellee, State of Louisiana, Department of Public Safety and Corrections, Dixon Correctional Institute, is affirmed. All costs of this appeal are assessed to the appellant, Harry S. Kilbourne.