State Treasurer, Second Injury Fund v. Coleman

Donald L. Corbin, Judge. This is an appeal by the Second Injury Fund (SIF) from a Workers’ Compensation Commission decision that appellee Dewey Coleman had suffered a “previous disability”, in addition to his compensable injury incurred while working for appellee Hardwick Airmasters, and that SIF was required to pay for that degree of disability arising from Coleman’s first injury. SIF contends on appeal that Coleman’s first injury was not acting to independently produce some degree of permanent disability both before and after the date of the last injury and that because the employer, Hardwick Airmasters, had no knowledge of the prior injury, the SIF could not be liable for Coleman’s prior conditions. We reverse and remand. Appellee Coleman’s first back injury occurred on August 3, 1981, while working for Brown and Root, Inc. There is no medical report in the record of this injury. He had no history of back pain prior to this time. After this injury Coleman visited the doctor on September 9, 30, October 4, and November 11 of 1981 for back problems. He was operated on in December of 1981, and, with the exception of a slip on the ice in January of 1982, had no further problems with his back until he injured it on September 13,1982. On March 4, 1982, a Joint Petition Order was entered on a workers’ compensation claim, awarding Coleman $12,000, plus outstanding medical bills, to settle his claim against Brown and Root. There was no mention of any degree of permanent disability in either the order or petition. The only report in the record by the surgeon, Dr. DeSaussure, after the first surgery and prior to the second injury, gave no degree of permanent disability, noted that Coleman was doing extremely well, and stated that he could be able to return to work in a couple of months to a job which required the lifting of 200 or more pounds. Coleman testified that he was given no physical restrictions upon being released for work after the first operation. After the first surgery for the second injury, Dr. DeSaussure rated his permanent partial disability from the first injury at 15% and increased it by 10% as a result of the second injury. Dr. Thomas, who performed the third operation, the second for the second injury, gave Coleman a permanent partial disability rating of 10% as a result of the first injury and an additional 15% as a result of the second. Appellee Coleman did not return to work for Brown and Root after the first accident, having been laid-off, and applied for work with appellee Hardwick Airmasters in May of 1982. He did not list his employment with Brown and Root on the employment application, nor did he list his previous injury or the joint petition settlement. Coleman testified that he told the superintendent for Hardwick, Jim Musgrave, about his back injury, and that he did not have any physical limitations because of it, and said Mus-grave told him to put down he had no restrictions. Coleman testified that he was in great physical shape before the second injury on September 13,1982. He stated that he carried 20-foot pipe on his shoulder all day long. He testified that he felt fully recovered from the 1981 injury, and that he was not limited or restricted in any respect from performing his job at Hardwick Airmasters. He also testified that he was not taking any medication prior to the September 1982 injury, and often worked on Saturdays to get overtime pay. Finally, he stated that he was having no back or leg problems prior to the September 1982 injury. He further testified, as did a co-worker, that it was common knowledge that he had had back surgery. While Mus-grave testified that he did not know about Coleman’s previous back injury at any time prior to his subsequent injury and that he would not have hired him had he known, he also conceded that he had not looked at the application until after he had hired Coleman and Coleman had started to work. Musgrave did testify that he had observed the scar on Coleman’s back, but Coleman told him that this had occurred when he was shot while in Vietnam. It is uncontroverted that Coleman had no trouble prior to his second injury in handling the workload at Hardwick Airmasters. While the Shippers defense was raised at the second hearing before the Administrative Law Judge, he ruled that the issue was res judicata because the employer had stipulated in a previous hearing that the injury was compensable, but that even if it were not res judicata, the employer and SIF had failed to prove all three elements of the Shippers defense. This ruling was not appealed to the Full Commission, nor has it been appealed to our Court. The Workers’ Compensation Act provides for payments by SIF when a subsequently injured employee has a “previous disability or impairment.” Ark. Stat. Ann. § 81-1313(i)(l) (Supp. 1985) provides in part: Second Injury. (1) The Second Injury Fund established herein is a special fund designed to insure that an employer employing a handicapped worker will not, in the event such worker suffers an injury on the job, be held liable for a greater disability or impairment than actually occurred while the worker was in his employment. The employee is to be fully protected in that the Second Injury Fund pays the worker the difference between the employer’s liability and the balance of his disability or impairment which results from all disabilities or impairments combined. It is intended that latent conditions, which are not known to the employee or employer, not be considered previous disabilities or impairments which would give rise to a claim against the Second Injury Fund. Commencing January 1, 1981, all cases of permanent disability or impairment where there has been previous disability or impairment shall be compensated as herein provided. Compensation shall be computed on the basis of the average earnings at the time of the last injury. If any employee who has a permanent partial disability or impairment, whether from compensable injury or otherwise, receives a subsequent compensable injury resulting in additional permanent partial disability or impairment so that the degree or percentage of disability or impairment caused by the combined disabilities or impairments is greater than that which would have resulted from the last injury, considered alone and of itself, and if the employee is entitled to receive compensation on the basis of combined disabilities or impairments, the employer at the time of the last injury shall be liable only for the degree or percentage of disability or impairment which would have resulted from the last injury had there been no pre-existing disability or impairment. After the compensation liability of the employer for the last injury, considered alone, which shall be no greater than the actual anatomical impairment resulting from said last injury, has been determined by an administrative law judge or the Commission, the degree or percentage of employee’s disability that is attributable to all injuries or conditions existing at the time the last injury was sustained shall then be determined by the administrative law judge or the Commission and the degree or percentage of disability or impairment which existed prior to the last injury plus the disability or impairment resulting from the combined disability shall be determined and compensation for that balance, if any, shall be paid out of a special fund known as a Second Injury Fund provided for in Section 47 (Ark. Stats. 81-1348). The first two sentences of Ark. Stat. Ann. § 81-1313 (i) (1) expressly state the purposes of the SIF statute to limit the employer’s liability and simultaneously “fully protect” an already handicapped employee where he is subsequently injured on the job. The Arkansas Supreme Court has directed this is a “special” fund and its solvency demands all its provisions be strictly complied with to further its limited and restricted purpose. “This fund, called the ‘Second Injury Fund’, is a limited and restricted fund . . . While Workmen’s Compensation Acts are generally to be liberally construed the solvency of this special ‘Second Injury Fund’ requires that the provisions and requirements thereof be fully and strictly complied with. . . To hold otherwise would open this special fund to the point of insolvency and provide no benefit to those who do comply with its provisions and who are entitled to benefits thereunder.” Arkansas Workmen’s Compensation Commission v. Sandy, 217 Ark. 821, 233 S.W.2d 382 (1950) (quoting from the opinion of the Commission). Webster’s Third World New International Dictionary defines handicapped as “. . .a physical disability that limits the capacity to work.” Disability has been defined under the Workers’ Compensation Act as the “incapacity because of injury to earn, in the same or any other employment, the wages which the employee was receiving at the time of the injury.” Ark. Stat. Ann. § 81-1302(e) (Repl. 1976). A person can be disabled if the injury has caused a physical loss or an inability to earn as much as he was earning when he was hurt. Bragg v. Evans-St. Clair, Inc., 15 Ark. App. 53, 688 S.W.2d 956 (1985); Terrell v. Austin Bridge Co., 10 Ark. App. 1,660 S.W.2d 941 (1983). An injury must be more than an anatomical disability, but must be a disability in the “compensation sense” to be a previous disability, as defined in § 81-1302(e), requiring apportionment under the Workers’ Compensation Act. Cooper Industrial Products v. Worth, 256 Ark. 394, 508 S.W.2d 59 (1974); Henderson State University v. Haynie, 269 Ark. 721, 600 S.W.2d 454 (Ark. App. 1980). Appellant argues that the Commission erred in finding that Coleman had a prior disability or impairment pursuant to Ark. Stat. Ann. § 81-1313(i)(l), which rendered him a handicapped worker prior to his compensable injury on September 13, 1982. We have previously held in Craighead Memorial Hospital v. Honeycutt, 5 Ark. App. 90, 633 S.W.2d 53 (1982), and Harrison Furniture v. Chrobak, 2 Ark. App. 364, 620 S.W.2d 955 (1981), that while an impairment did not have to be job-related for apportionment to apply, it did have to be independently causing disability prior to the second injury and must have continued to cause disability after the second injury. Whether a person is “disabled” according to the statute is determined by his loss of wage earning capacity. Furthermore, in Osage Oil Co. v. Rogers, 15 Ark. App. 319, 692 S.W.2d 786 (1985), we held that “impairment” as used in Ark. Stat. Ann. § 81-1313 (i) (1) means loss of earning capacity due to a non-work related condition. In Osage Oil we rejected the contention that the SIF was liable even when the claimant had previously suffered only an anatomical impairment of some type, holding that the purpose of the Act is to encourage the employment of handicapped workers by providing that in the event of injury to those workers the employer will not have to pay for any more disability than actually occurred in his employment and not to provide employers with a windfall or subsidy. We reaffirm that position. On appeal, this Court is required to review the evidence in the light most favorable to the Commission’s decision and to uphold that decision if it is supported by substantial evidence. Even when a preponderance of the evidence might indicate a contrary result, we affirm if reasonable minds could reach the Commission’s conclusion. Questions of credibility and the weight and sufficiency of the evidence are matters for determination by the Commission. The Commission is better equipped by specialization and experience to analyze and translate evidence into findings than we are. Bemberg Iron Works v. Martin, 12 Ark. App. 128, 671 S.W.2d 768 (1984). When guided by the above rules of law, we hold that there is no substantial evidence in the instant case to support the Commission’s finding as there is no evidence that Coleman had a reduction of earning capacity. In order to be apportionable under the statute, the condition must have been independently causing a disability prior to the second injury and continue to do so after the second injury. Id. The condition must be “of a ‘physical quality capable of supporting an award if the other elements of compensability were present.’ ” Id. at 324. We believe that it is clear appellee Coleman’s injury of 1981 was not a disability or impairment and that, therefore, appellant SIF has no liability under the law. Since we reverse and remand on this point, we need not address appellant’s second assignment of error. Reversed and remanded for an entry of an order consistent with this opinion. Reversed and remanded. Mayfield, J., concurs. Glaze, J., dissents.