Beale v. Stratton

GANT, Justice. These cases come to us on discretionary review from the Court of Appeals and that [202] court’s holding that the deletion of certain language from KRS 342.120(5) had the effect of requiring the Special Fund to compensate the employee for prior active disabilities. We disagree, and reverse. Monie D. Stratton was employed by Curtis 1000. In 1969, she received a non-work-related back injury while mopping the floors in her home, which injury required a spinal fusion. She returned to work after this operation and in 1974 received a work injury in which her right thumb and three fingers were amputated, three of the fingers being successfully reattached. As a result of that injury, Stratton received a Workers’ Compensation award of 45.25%, which was paid in a lump sum of $28,-990.92. After again returning to work, in 1983 she sustained a second injury to her back, which set this case into action. On motion of the employer, the claims were consolidated, and all parties agreed that the Board was bound to follow the steps required by Younq v. Fulkerson, Ky., 463 S.W.2d 118 (1971). After the taking of proof, the Board found that Stratton had sustained an occupational disability which rendered her 100% permanently disabled. Seventy per cent of this disability was ascribed to a pre-exist-ing active disability and not compensable. The remaining 30% was assigned 15% to the employer and 15% to the Special Fund. In August, 1984, Michael D. Long suffered a work-related injury to both knees, which the Board determined rendered him 50% occupationally disabled. In its apportionment, the Board found that 25% of the disability was an active disability which existed before the injury as the result of a previous non-work-related injury and surgeries, and held this non-compensable. The remaining percentages were assigned 10% to the employer and 15% to the Special Fund. The question before us, as stated, is whether the 1982 amendments to KRS Chapter 342 required the Special Fund to pay the employee for prior active disabilities. Prior to said amendments, KRS 342.-120 in the section pertaining to the Special Fund, provided: The remaining compensation for which such resulting condition would entitle the employee, including any compensation for disability resulting from a dormant disease or condition aroused into disabling reality by the injury or occupational disease, but excluding all compensation which the provisions of this chapter would have afforded on account of pri- or disabling disease or injury had it been compensated thereunder, shall be paid out of the Special Fund ... In addition to other amendments to KRS Chapter 342, the underlined portion above was deleted. The Court of Appeals construed this deletion to mean that the Special Fund must compensate the employee for any previous active disability, in addition to disability resulting from a dormant disease or condition aroused into disabling reality or occupational disease. The history of Workers' Compensation in Kentucky has been one of constant change by the legislature and constant interpretation by the courts. As called to our attention by the Special Fund, the case of Yocom v. Jackson, Ky.App., 554 S.W.2d 891 (1977), contains an excellent discourse on the concept of liability by the Special Fund. An examination of the history and purpose of the Special Fund, however, reveals that, to this date, “pre-existing active disability” has never been compensated in Kentucky. The phrase “active disability” is largely a judicial concept, and has never appeared in the statutes. See Wells v. Bunch, Ky., 692 S.W.2d 806 (1985). Although Transport Motors Express, Inc. v. Finn, Ky., 574 S.W.2d 277 (1978), utilized the deleted exclusionary language in reaching the result therein, that was only a part of the picture, and we note that the deleted portion does not utilize the phrase “pre-existing active disability.” KRS 342.120, as adopted in 1982, reads as follows: 342.120. Creation of division of special fund — Subsequent injury compensation — Special fund as a party. — (1) There is created the division of the spe [203] cial fund in the department of labor which shall be responsible for the administration of the legal representation of the fund and the maintenance of records regarding the payment of claims by the fund. (2) A claimant may in the original application for benefits, or either party may by motion while the case is pending, accompanied by proper allegations and by certification of the fact that a copy of the motion and the entire case file has been forwarded to the special fund at the cost of the movant, request the board to and the board shall, or upon its own motion the board may, at any time before the rendition of the final award, cause the special fund to be made a party to the proceedings if either or both of the following appears: (a) the employe is disabled, whether from a compensable injury, occupational disease, pre-existing disease, or otherwise, and has received a subsequent com-pensable injury by accident, or has developed an occupational disease; (b) The employe is found to have a dormant non-disabling disease or condition which was aroused or brought into disabling reality by reason of a subsequent compensable injury by accident or an occupational disease. (3) When the special fund has been made a party the board may direct the procedures provided in KRS 342.121. (4) If it is found that the employe is a person mentioned in paragraphs (a) or (b) of subsection (2) of this section and a subsequent compensable injury or occupational disease has resulted in additional permanent disability so that the degree of disability caused by the combined disabilities is greater than that which would have resulted from the subsequent injury or occupational disease alone, and the employe is entitled to receive compensation on the basis of the combined disabilities, the employer shall be liable for the payment of all income benefits until the benefits paid have reached a percentage of the full income benefits awarded by the board which is equal to the percentage of disability which would have resulted from the latter injury or occupational disease had there been no pre-existing disability or dormant, but aroused, disease or condition. (5)The remaining compensation for which such resulting condition would entitle the employe, including any compensation for disability resulting from a dormant disease or condition aroused into disabling reality by the injury or occupational disease, shall be paid out of the special fund provided for in KRS 342.122. Such remaining compensation shall be paid directly to the employe under such regulations as the secretary of finance may provide for such purpose. It is our opinion that the liability of the Special Fund created by Paragraph (5) in its use of “The remaining compensation for ... resulting condition ...” refers only to disability caused by the second or present injury, excess disability, and disability due to the arousal of a pre-existing dormant disease or condition. The Special Fund is not by any language in this statute required to compensate the employee for a pre-existing active disability. As pointed out by the Special Fund, to hold otherwise could require the Special Fund to compensate an employee for a pre-existing disability for which he had already collected from a tortfeasor or employer, or for an injury barred by the Statute of Limitations, etc. In the Stratton case herein, many pages were devoted to discussion by the respondent and cross-movant, Monie D. Stratton, of the 45.25% previous award made by the Workers’ Compensation Board, speculating that the Workers’ Compensation Board must have included this figure in arriving at the 70% it assigned to the pre-existing active disability. In reading the evidence presented to the Workers’ Compensation Board, we do not find this to be a fact. All the evidence from the two orthopedic surgeons and the neurosurgeon related to the previous condition of the back injury, which was non-work-related. Two of the doctors opined that all the problems of the employee related to the pre-existing back disability, and, indeed, Dr. Mitchell, her treating physician, was specifically asked and stated [204] the injury to her hand was not included in the figure he ascribed to the pre-existing disability. There was ample evidence to support the Board’s finding of 70% pre-exist-ing active non-compensable disability to the back. It is obvious that the hand is a different part of the body and was not, and could not be, considered in the award. The opinion of the Court of Appeals in both cases is reversed, and these cases are remanded to the Workers’ Compensation Board with directions that the Opinion and Award be reinstated. STEPHENS, C.J., and LAMBERT, VANCE and WINTERSHEIMER, JJ., concur. COMBS and LEIBSON, JJ., dissent. LEIBSON, J., files a separate dissenting opinion in which COMBS, J., joins.