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In re Compensation of Brown

Supreme Court of Oregon

March 30, 2017

In the Matter of the Compensation of Royce L. Brown, Sr., Claimant.
v.
SAIF CORPORATION and Harris Transportation Company, LLC, Petitioners on Review. Jesse BROWN, Personal Representative of the Estate of Royce L. Brown, Sr., Petitioner, Respondent on Review,

          Argued and submitted May 11, 2015.

         On review from the Court of Appeals WCB No. 11-02146, CA A151889 [*]

          Julie Masters, Appellate Counsel, SAIF Corporation, Salem, argued the cause and fled the briefs for petitioners on review.

          Julene M. Quinn, Portland, argued the cause and fled the brief for respondent on review.

          Jerald P. Keene, Oregon Workers' Compensation Institute, LLC, Oceanside, fled the brief for amici curiae Associated Oregon Industries and Oregon Self Insurers Association.

          James S. Coon, Swanson, Thomas, Coon & Newton, Portland, fled the brief for amicus curiae Oregon Trial Lawyers Association.

          Before Balmer, Chief Justice, and Kistler, Walters, Landau, Baldwin, and Brewer, Justices. [**]

          LANDAU, J.

         Case Summary: Claimant, who sustained an on the job injury to his back, fled a workers' compensation claim, and SAIF accepted a claim for lumbar strain, combined with claimant's preexisting lumbar disc disease and related conditions. SAIF later denied the claim on the ground that the lumbar strain had ceased to be the major contributing cause of claimant's combined condition. Claimant challenged the denial, arguing that the compensable condition was not just the condition that SAIF had previously accepted, but included other, non-accepted conditions that might have resulted from the work-related accident. Held: Under ORS 656.005(7)(a)(B), when an "otherwise compensable injury" has combined with a preexisting condition, the combined condition is compensable only so long as the compensable injury remains the major contributing cause of the need for treatment. When an insurer concludes that the compensable injury has ceased to be the major contributing cause, it may deny the claim pursuant to ORS 656.062 on the ground that the "accepted" injury is no longer the major contributing cause of the combined condition. Similarly, under ORS 656.028, the insurer may close a claim when the "accepted" injury is no longer the cause of the claimant's combined condition. Thus, in the context of a combined condition claim that has previously been accepted, the "otherwise compensable injury" referred to in ORS 656.005(7)(a)(B) is the "accepted" injury.

         The decision of the Court of Appeals is reversed. The fnal order of the Workers' Compensation Board is affrmed.

          LANDAU, J.

         The issue in this workers' compensation case is whether claimant is entitled to benefits for his "combined condition" claim. Under ORS 656.005(7)(a)(B), a "combined condition" exists when an "otherwise compensable injury" combines with a preexisting condition, and the otherwise compensable injury remains the major contributing cause of that combined condition.[1] In this case, claimant filed- and his employer's insurer, SAIF Corporation, initially accepted-a claim for a lumbar strain combined with preexisting lumbar disc disease and related conditions. SAIF later denied the combined condition claim on the ground that the lumbar strain had ceased to be the major contributing cause of the combined condition. Claimant objected. He did not contest that his lumbar strain had ceased to be the major contributing cause of his combined condition. Instead, he argued that the otherwise compensable injury was not limited to the lumbar strain that SAIF had accepted as part of his combined condition claim. In claimant's view, an "otherwise compensable injury" within the meaning of ORS 656.005(7)(a)(B) refers not just to the condition that SAIF accepted, but also includes any other conditions not accepted that might have resulted from the same work-related accident that caused the lumbar strain, and that larger group of work-related conditions continues to be the major contributing cause of his combined condition. As a result, claimant contended that an employer cannot close a combined condition claim if any of those non accepted conditions remain the major cause of the combined condition claim.

         The Workers' Compensation Board rejected claimant's argument and upheld SAIF's denial of claimant's combined condition claim, concluding that existing precedent defined the "otherwise compensable injury" component of combined conditions to consist of the condition or conditions that the employer has accepted as compensable. The Court of Appeals reversed, acknowledging that its holding was "potentially at odds" with existing precedents from both that court and this one. Brown v. SAIF. 262 Or.App. 640, 653, 325 P.3d 834 (2014). It nevertheless concluded that those precedents were either distinguishable or should be reconsidered. Id. For the reasons that follow, we conclude that the Court of Appeals erred and that the Workers' Compensation Board was correct.

         I. FACTS

         The relevant facts are not in dispute. Claimant had a history of back problems dating back to 1993, when he was first treated for back problems. He started work for employer as a truck driver in 2002. That same year, he slipped and fell on his buttocks in a restaurant bathroom. A lumbar spine X-ray taken shortly after showed degenerative changes.

         In 2006, claimant went to a hospital emergency room complaining of back pain over the preceding month. He was referred to an orthopedist, Dr. Matthew Gambee, who ordered an MRI. The MRI revealed an L4-5 disc protrusion with compression of the L4 nerve root, along with a number of degenerative changes. Dr. Gambee performed an epidural steroid injection, but that provided no sustained relief.

         Claimant was referred to a neurosurgeon, Dr. Hoang N. Le, who performed surgery that included a right-side L4-5 decompression, discectomy, and transforaminal lumbar interbody fusion. In April 2007, claimant reported having no back or leg pain, and he was released to full duty. Over the course of the next year and a half, claimant performed his regular duties as a truck driver. He experienced some ongoing numbness in two toes of his right foot, and he had occasional minor back pain.

         On December 14, 2008, while hanging heavy truck-tire chains under his truck, claimant felt a sudden burning with sharp pain in his lower back that radiated into his right leg. The next day, he went to a hospital emergency room with the same complaints. The treating doctor ordered X-rays of claimant's back, which showed no evidence of acute bone or joint abnormality. So the doctor placed him on modified duty restrictions and prescribed pain medications.

         Several days later, claimant saw Dr. Susan Davis, who diagnosed a lumbar strain secondary to the December 14, 2008, work injury. She placed claimant on light duty restriction, prescribed conservative treatment, and referred claimant to physical therapy. Claimant submitted a workers' compensation claim for his lower back pain. SAIF accepted a claim for a disabling "lumbar strain." The notice of acceptance included a notice that, should claimant's condition worsen, he could be entitled to additional benefits for an aggravation claim.

         Claimant continued to feel pain in his right hip and down his right leg. Dr. Davis ordered a CT scan of the lumbar spine, which revealed L4-5 right marked foraminal stenosis related to spondylolisthesis and spurring. Dr. Davis referred claimant to an occupational medicine specialist, Dr. Fernando Proano, who referred claimant back to Dr. Le for a neurosurgical consultation.

         Meanwhile, Dr. Proano examined claimant in June 2009. He diagnosed a lumbar strain combined with preexisting lumbar disc disease and noted that claimant's work accident had aggravated the preexisting conditions. Dr. Proano again examined claimant in August 2009. He reported that, at that point, claimant's lumbar strain had reached medically stationary status with no impairment findings due to the strain. Based on Dr. Proano's report, SAIF issued a notice of closure that closed the claim for lumbar strain and awarded no permanent disability benefits for the accepted lumbar strain.

         Claimant continued to experience pain and returned to Dr. Le, who then performed a "right L4-5 instrumentation removal and redo decompression of the L4 nerve root." But claimant experienced no significant relief from the surgery.

         In January 2010, claimant filed a combined condition claim for "lumbar strain combined with lumbar disc disease and spondylolisthesis." SAIF initially resisted, but, after some litigation, it accepted the combined condition claim, specifying that it was accepting, in addition to the originally accepted lumbar strain, a combined condition consisting of "lumbar strain combined with preexisting lumbar disc disease and spondylolisthesis."

         Approximately two months later, SAIF ordered an independent medical examination by Dr. Edmund Frank. He opined that the lumbar strain combined with the lumbar disc disease and spondylolisthesis had resolved and that the work-related lumbar strain had ceased to be the major contributing cause of claimant's disability and need for treatment. Dr. Frank concluded that claimant's symptoms related to right L5 radiculopathy secondary to the preexisting spondylolisthesis at L4-5, the fusion-related pseudoarthritis at L4-5, and the scarring of the nerve root, all of which were unrelated to claimant's work-related lumbar strain. SAIF then issued a denial of claimant's combined condition claim as of the date that his lumbar strain had become medically stationary, on the ground that, at that point, the accepted lumbar strain had ceased to be the major contributing cause of claimant's combined condition.

         Claimant requested a hearing on the denial of the combined condition claim. At the hearing, SAIF offered the testimony of Dr. Proano that the accepted lumbar strain had ceased to be the major contributing cause of claimant's combined condition. Claimant did not challenge that evidence. Instead, he argued that the original December 14, 2008, work injury resulted not only in lumbar strain, but also in worsening his preexisting conditions. In claimant's view, the combined condition claim includes not only the accepted lumbar strain, but the worsening of the preexisting conditions as well. Both the lumbar strain and the worsening of preexisting conditions, he argued, should be considered the "otherwise compensable injury, " which he asserted continues to be the major contributing cause of his combined condition.

         The administrative law judge rejected claimant's argument and upheld SAIF's denial. The ALJ noted claimant's argument that the December 14, 2008, work injury had worsened his preexisting conditions, but concluded that the argument was beside the point, as claimant had not filed a claim for such worsening. The ALJ noted that claimant's combined condition claim was for the accepted lumbar strain and the preexisting conditions only. Under the circumstances, the ALJ concluded, the "otherwise compensable injury" is "limited to the lumbar strain."

         Claimant sought review by the Workers' Compensation Board, which adopted and affirmed the ALJ's order with the added observation that the denial of claimant's combined condition claim was compelled by its own case law, as well as case law from the Court of Appeals. Board Member Weddell concurred, writing separately to explain that, although the Board's decision was indeed compelled by existing precedent, in her view that precedent should be reexamined. Weddell asserted that the existing precedent was contradicted by several cited excerpts from the legislative history of the 1990 and 1995 amendments that are reflected in current workers' compensation statutes. She also observed that the existing precedent has the potential to leave claimants without remedies in certain circumstances.

         The Court of Appeals took up the concurrence's suggestion and reversed the Board. The court concluded that ORS 656.005(7)(a)(B), which describes a combined condition as a combination of an "otherwise compensable injury" and a preexisting condition, is "injury-incident focused." 262 Or.App. at 646. Thus, the court explained, the statute "requires a determination that there was an injury incident" that combines with a preexisting condition to create the combined condition claim. Id. at 646-47. That "injury incident" is not limited to particular resulting medical conditions, much less particular resulting medical conditions that have been accepted, the court continued. Id. at 648. In the view of the Court of Appeals, "there is no statutory provision that expressly links the compensability of a combined condition to its relationship to an 'accepted condition.'" Id. The court found confirmation of the "injury-incident focus" of the statute in several excerpts from the legislative history of amendments to the statute in 1990 and 1995, id. at 648-650, which it read to reveal a legislative intent that an employer's acceptance of a claim "'does not have any negative consequences for the worker.'" Id. at 650 (emphasis deleted; quoting statement of Representative Kevin Mannix).

         In reaching the conclusion that the "otherwise compensable injury" component of a combined condition claim is not limited to accepted conditions, the Court of Appeals said, "[w]e recognize that our conclusion is potentially at odds with what we and the Supreme Court have said" in other cases. Id. at 653. The court nevertheless suggested that those contrary statements are better viewed as dicta or as inadequately considered without benefit of the legislative history on which it now relied. Id. In the end, the court reversed and remanded the case for reconsideration in light of its broader reading of the nature of the "otherwise compensable injury" to include other medical conditions related to the "injury incident, " such as the worsening of preexisting conditions, but which were not within the scope of the work-related conditions that SAIF accepted. Id. at 656.

         We allowed review to address the proper interpretation of ORS 656.005(7)(a)(B) and related statutes. While review was pending, claimant passed away. The court was notified that claimant's estate intended to substitute a personal representative, once the personal representative had been qualified by the probate court. We held the case until August 11, 2016, when we received a motion to substitute Jesse Brown as the petitioner on review. See Sather v. SAIF. 357 Or 122, 136, 347 P.3d 326 (2015) (a "person" entitled to workers' compensation benefits includes a deceased worker's estate). The motion was allowed. In the balance of this opinion, when we refer to "claimant, " we refer to the personal representative of claimant's estate.

         II. ANALYSIS

         On review, SAIF argues that the Court of Appeals has significantly misconstrued the requirements of ORS 656.005(7)(a)(B) and departed from the way courts have uniformly interpreted the statute for the last 15 years. In SAIF's view, "the notice of acceptance signifies the scope of a compensable injury" for the purposes of a previously accepted combined condition claim. SAIF contends that the Court of Appeals, in reaching a contrary conclusion, ignored a number of statutory provisions that expressly equate the "otherwise compensable injury" with an "accepted condition" in this circumstance. Moreover, SAIF argues, the Court of Appeals relied on snippets of legislative history removed from their context, giving those bits of history significance that is at odds with what the legislature was actually attempting to accomplish.

          For his part, claimant argues that the Court of Appeals was essentially correct in construing the "otherwise compensable injury" as "the work accident and all of the effects that flow from it, " not a particular medical condition. Claimant's argument rests on the assertion that the relevant statutes "do[] not expressly (or impliedly) include the requirement of a 'condition.'" Rather, he says, they refer to a compensable "injury, " which can be understood to apply to an on-the-job incident that results in a medical condition. Claimant urges us to give special attention to the legislative history of the 1990 and 1995 amendments to the statutes, as did the Court of Appeals. In claimant's view, that history reveals that the legislature did not intend the acceptance of a claim to have any sort of limiting effect on a claimant's rights.

         We are thus confronted with an issue of statutory construction. We resolve that issue in accordance with the rules of interpretation described in PGE v. Bureau of Labor and Industries, 317 Or 606, 610-12, 859 P.2d 1143 (1993), and State v. Gaines. 346 Or 160, 171-73, 206 P.3d 1042 (2009). Among those that guide our construction of the statutes at issue in this case is the essential principle that the best evidence of what the legislature intended a statute to mean is the wording of the statute that it adopted into law. As this court explained in Gaines,

"[o]nly the text of a statute receives the consideration and approval of a majority of the members of the legislature, as required to have the effect of law. Or Const, Art IV, § 25. The formal requirements of lawmaking produce the best source from which to discern the legislature's intent, for it is not the intent of the individual legislators that governs, but the intent of the legislature as formally enacted into law[.]"

346 Or at 171. With that in mind, we turn to the statutes at issue in this case.

         A. Statutory background

         We begin with some background for context. Under Oregon's workers' compensation law, employers are required to provide compensation to workers who suffer "compensable injuries." ORS 656.017(1). A "compensable injury" is a term of art, meaning, with certain limitations and exceptions:

"an accidental injury, or accidental injury to prosthetic appliances, arising out of and in the course of employment requiring medical services or resulting in disability or death; an injury is accidental if the result is an accident, whether or not due to an accidental means, if it is established by medical evidence supported by objective findings [.]."

ORS 656.005(7)(a)(A). A "compensable injury, " for example, does not include " [i] njury to any active participant in assaults or combats which are not connected to the job assignment and which amount to a deviation from customary duties." ORS 656.005(7)(b)(A). Similarly, it does not include "[i] njury incurred while engaging in or performing or as the result of engaging in or performing, any recreational or social activities primarily for the worker's personal pleasure." ORS 656.005(7)(b)(B).

         A worker who has suffered a compensable injury must file a "[n]otice of an accident resulting in an injury or death" immediately after the accident. ORS 656.265 (1)(a). The worker is then entitled to file a claim for workers' compensation benefits. Within 60 days of the filing of that claim, the employer is required to provide a written notice of acceptance or denial of that claim. ORS 656.262 (6)(a). Merely paying or providing compensation is not sufficient to constitute acceptance of a claim. ORS 656.262(10). There must be a written notice of acceptance of a claim, which is required to "[s]pecify what conditions are compensable." ORS 656.262(6)(b)(A); see also ORS 656.267(1) (employer's notice of acceptance is sufficient if it "reasonably apprises the claimant and the medical providers of the nature of the compensable conditions"). If a claimant believes that such a written notice of acceptance incorrectly omits a compensable condition, he or she may object at any time and file a claim for the omitted condition. ORS 656.262(6)(d).

         Ordinarily, it is the claimant's burden to establish that a particular injury is compensable. ORS 656.266(1). The claimant must prove that the work-related injury is a "material" cause of the disability or the need for treatment. See SAIF v. Sprague. 346 Or 661, 663-64, 217 P.3d 644 (2009) (discussing claimant's burden). There are, however, at least two exceptions to that burden.

         The first such exception is triggered if an "otherwise compensable injury"-that is, an injury that would otherwise be compensable but for the exception-combines with a preexisting condition to create what is known as a "combined condition":

"If an otherwise compensable injury combines at any time with a preexisting condition to cause or prolong disability or a need for treatment, the combined condition is compensable only if, so long as and to the extent that the otherwise compensable injury is the major contributing cause of the disability of the combined condition or the major contributing cause of the need for treatment of the combined condition."

ORS 656.005(7)(a)(B). In such combined condition cases, the burden is altered in two respects. First, if a compensable injury combines with a preexisting condition, it is compensable only if the major contributing cause-not just the material cause-of the resulting combined condition is the compensable injury. ORS 656.266(2)(a). Second, it is the employer's burden to establish that the work-related compensable injury is not the major contributing cause of the combined condition. Id.; see also Hopkins v. SAIF. 349 Or 348, 351-52, 245 P.3d 90 (2010) (describing burden in combined condition cases).

         If an employer accepts a combined condition claim, that acceptance does not preclude the employer from later denying the claim, should circumstances change so that the otherwise compensable condition is no longer the major contributing cause of the combined condition. ORS 656.262(6)(c). If the employer believes that to be the case, it is required to notify the claimant in writing that the "accepted injury" is no longer the major contributing cause of that combined condition:

"Once a worker's claim has been accepted, the insurer or self-insured employer must issue a written denial to the worker when the accepted injury is no longer the major contributing cause of the worker's combined condition before the claim may be closed."

ORS 656.262(7)(b); see also ORS 656.268(1)(b) (employer authorized to close combined condition claim if "[t]he accepted injury is no longer the major contributing cause" of the combined condition).

         The second exception to the ordinary burden of persuasion applies in "consequential condition" cases:

"No injury or disease is compensable as a consequence of a compensable injury unless the compensable injury is the major contributing cause of the consequential condition."

ORS 656.005(7)(a)(A). In such cases, although the allocation of the burden has not changed, the ordinary material contributing cause standard no longer applies; the claimant must establish that the major contributing cause of the consequential condition was the work-related compensable injury.

         Workers' compensation benefits may include medical services. For an ordinary compensable injury, the claimant is entitled to compensation for medical services for conditions "caused in material part" by the compensable injury. ORS 656.245(1)(a). For consequential and combined conditions, the claimant is entitled to compensation for "only those medical services directed to medical conditions caused in major part by the injury." Id.

         One final bit of statutory context deserves mention. If a claimant's compensable injury becomes "medically stationary, " the employer is authorized to close the claim and, if appropriate, award permanent disability. ORS 656.268(1)(a). After a claim has been closed, if the claimant's condition resulting from the original injury gets worse, the ...


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