Harbor Insurance Company v. Industrial Commission

537 P.2d 34, 24 Ariz. App. 197, 1975 Ariz. App. LEXIS 676
CourtCourt of Appeals of Arizona
DecidedJune 24, 1975
Docket1 CA-IC 1180
StatusPublished
Cited by3 cases

This text of 537 P.2d 34 (Harbor Insurance Company v. Industrial Commission) is published on Counsel Stack Legal Research, covering Court of Appeals of Arizona primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Harbor Insurance Company v. Industrial Commission, 537 P.2d 34, 24 Ariz. App. 197, 1975 Ariz. App. LEXIS 676 (Ark. Ct. App. 1975).

Opinion

OPINION

NELSON, Presiding Judge.

The critical question presented for review is whether a workmen’s compensation insurance carrier has the right to suspend or terminate payment of permanent partial disability benefits to a claimant when the claimant seeks and receives total temporary disability benefits from another workmen’s compensation carrier as the result of a subsequent industrial injury. We hold that a workmen’s compensation insurance carrier is not vested with that authority and we therefore affirm the award of the Industrial Commission.

Raymond Adair sustained an industrial injury to his back in the course of his employment as a salesman for Ray Korte Chevrolet (Korte) on August 13, 1971. Petitioner, Harbor Insurance Company (Harbor), as the employer’s workmen’s compensation insurance carrier, accepted Adair’s claim for compensation and medi *198 cal benefits on September 23, 1971. A laminectomy was performed on Adair’s back and he underwent extended post-operative treatment. Proceedings relative to the August, 1971 injury ultimately culminated in a Decision Upon Hearing and Findings and Award for Permanent Partial Unscheduled Disability issued on November 21, 1973, wherein the Industrial Commission found a 46.1% reduction in Adair’s earning capacity entitling him to permanent partial disability payments in the monthly amount of $236.33. Harbor did not protest that decision and the award became final.

At the hearing which preceded the Commission’s November 21, 1973 award of permanent partial disability benefits, evidence was presented which indicated that Adair had, after unsuccessfully attempting to return to automobile sales, found work as a security guard early in 1973. On February 15, 1973, Adair sustained an industrial injury while patrolling a construction site for AVCO Community Developers. Because it was unclear whether this was a new injury, or an exacerbation of the prior injury sustained while employed by Korte, Adair filed both a new claim with CNA Insurance, AVCO’s workmen’s compensation insurer, and a petition to reopen the Harbor claim.

Subsequent thereto CNA Insurance granted Adair temporary compensation and Harbor denied his petition to reopen. Adair made a timely protest of Harbor’s denial of his petition to reopen, but it was apparently not acted on.

Harbor issued a Notice of Claim Status on December 21, 1973, terminating Adair’s permanent partial disability payments as of February 15, 1973, on the basis that Adair was concurrently receiving temporary total compensation from CNA Insurance as a result of the industrial injury sustained on February 15, T973. Although Adair contended that Harbor’s termination of his permanent partial disability payments was invalid because Harbor had no authority to make such a determination, Adair nevertheless filed a timely request for a hearing pursuant to A.R.S. § 23 — 1061J. On March 27, 1974, the Commission issued its award ordering the continuation of Adair’s permanent partial disability benefits as accrued from February 15, 1973. Harbor requested review and on May 20, 1974, the decision and award of March 27, 1974 was affirmed. Harbor sought and obtained review in this Court by writ of certiorari.

Harbor predicates its December 21, 1973 termination of Adair’s permanent partial disability benefits on the argument that an employee cannot, as the result of two successive injuries, be both totally and partially disabled at the same time, and that when the employee’s condition is no longer medically stationary following an injury for which permanent partial disability benefits have been awarded, such benefits are not payable during a period of temporary total disability. Assuming arguendo the validity of the foregoing argument, which assumption necessarily includes the assumption that the second injury is related to the first (it being obvious that one can be partially permanently disabled from one injury and totally temporarily disabled from a subsequent unrelated and different injury), the issue involved herein is whether a carrier may appropriately determine that the successive injuries are in fact related and then unilaterally suspend or terminate payment of permanent partial disability benefits when the employee receives total temporary disability benefits from another carrier.

In his Decision of March 27, 1974, the hearing officer made the following findings relative to the question presented on appeal herein:

"6. That the Industrial Commission was the agency and quasi-judicial body which administratively processed and quasi-judicially determined all claims under the Workmen’s Compensation Act prior to January 1, 1969; that pursuant to legislation effective January 1, 1969, certain (emphasis supplied) claims processing functions were delegated to insurance *199 carriers without the necessity of Commission action, A.RS. § 23-1061G, as amended 1968, but claims matters involving primarily ‘judgment’ or ‘discretionary’ matters were specifically retained under the exclusive control and jurisdiction of the Industrial Commission, i. e., under the so-called ‘suspension’ statutes, A.R.S. § 23-908E, 23-1026E, 23-1027, 23-1071, and determination of average monthly wage, A.R.S. § 23-1061F; that likewise, and as pertinent hereto, the determination of loss of earning capacity and entitlement to permanent compensation benefits therefor (pursuant to A.R. S. § 23-1044C) was likewise specifically retained and ‘redelegated’ to the Industrial Commission, A.R.S. § 23-1047A & B, as amended 1968, and see Germany v. Industrial Commission, 20 Ariz.App. 576, 514 P.2d 747, subject of course, to formal hearing rights when requested, pursuant to A.R.S. § 23-1047C; that it is thus patent the determination of loss of earning capacity, if any, (pursuant to A.R.S. § 23-1044C) is a duty exclusively of the Industrial Commission, either ‘administratively’ or as a result of formal hearing if timely requested; that the subject claim did proceed to such formal hearing, culminating in (now) final and res judicata DECISION UPON HEARING AND FINDINGS AND AWARD FOR PERMANENT PARTIAL UNSCHEDULED DISABILITY issued on November 21, 1973 hereinbefore discussed; that under ‘old’ law, it is well established the Industrial Commission itself cannot, without some additional ‘showing’ materially alter and/or ex parte terminate and/or suspend payment of permanent compensation benefits payable pursuant to a prior Industrial Commission final award. Hamlin v. Industrial Commission, 77 Ariz. 100, 267 P.2d 736 (1954); Carr v. Industrial Commission, 2 Ariz.App. 307, 408 P.2d 411 (1965), nor can an insurance carrier have such ‘right’ during the pendency of other proceedings; see, by analogy ', Beck v. Hartford Accident and Indemnity Company, 107 Ariz. 476, 489 P.2d 710 (1971).

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Bluebook (online)
537 P.2d 34, 24 Ariz. App. 197, 1975 Ariz. App. LEXIS 676, Counsel Stack Legal Research, https://law.counselstack.com/opinion/harbor-insurance-company-v-industrial-commission-arizctapp-1975.