Strachan Shipping Co. v. Nash

751 F.2d 1460
CourtCourt of Appeals for the Fifth Circuit
DecidedFebruary 4, 1985
DocketNo. 83-4332
StatusPublished
Cited by3 cases

This text of 751 F.2d 1460 (Strachan Shipping Co. v. Nash) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Strachan Shipping Co. v. Nash, 751 F.2d 1460 (5th Cir. 1985).

Opinions

JERRE S. WILLIAMS, Circuit Judge:

Respondent Earl F. Nash sought benefits under the Longshoremen’s and Harbor Workers’ Compensation Act (LHWCA), 33 U.S.C. §§ 901-950 (1982), for the permanent partial disability that his right knee sustained during his longshoring work for petitioner Strachan Shipping Company. Two prior injuries had partly disabled the knee, but respondent received compensation only for the second one. The Benefits Review Board adjudged Strachan responsible for the disability that the third and first casualties produced but absolved a [1462]*1462statutory “second-injury” fund1 from liability.

Our review obliges us to compute the liability that the LHWCA imposes respectively upon Strachan and the fund.2 We affirm the determination that the fund owes no compensation. We reverse, however, the holding the Strachan must pay benefits for respondent’s pre-existing disability despite his receipt of compensation under the LHWCA for an intervening work accident. After presenting the factual and procedural setting, we dispose of the issues seriatim.

I.

The parties do not dispute the underlying facts. Respondent first damaged his knee in 1969, during his senior year at Ball High School in Galveston, Texas. A fall in shop class shattered his right patella, necessitating its surgical removal. Respondent recovered no compensation for the accident. A medical report that respondent’s doctor prepared a decade later indicated that the injury produced twenty percent permanent partial disability to the knee.

Respondent’s second accident arose in the course of his work as a longshoreman on the Galveston docks for Chaparral Ste-vedoring Company. On June 19, 1974, a cotton-laden forklift struck respondent’s legs. The collision tore the medial meniscus in his right knee. Following unsuccessful conservative treatment, a surgeon excised the cartilage in October 1975. The doctor attributed to the injury an additional ten percent permanent partial disability. A report that another doctor had prepared a few months before the operation estimated the increment of disability at two percent, and a third physician’s report in 1979 calculated that the accident had added five percent disability.

As the LHWCA required it to do, Chaparral compensated respondent for temporary total and temporary partial disability until March 13, 1976, but the company disputed its obligation to pay benefits for permanent partial disability. After respondent Nash had discussed the matter with the United States Department of Labor, which administers the LHWCA, he and Chaparral settled his claim for additional benefits in April 1976. No lawyer represented him at the time. The “Agreement Regarding Facts” that he and Chaparral’s insurance carrier executed recited that the work injury had caused “Permanent Partial Disability equivalent to 10 percent loss____” It did not, however, mention the previous injury. The Office of Workers’ Compensation Programs of the Department of Labor received the settlement agreement the following day. The Office acknowledged receipt of the agreement in a letter that stated: “this is your authority to dispose of this matter on payment of compensation as outlined in the Agreement.”

The injury that generated this suit also occurred on the Galveston waterfront. While part of a work crew handling cotton bales aboard ship on March 16, 1978, respondent fell through a gap between bales, twisting his right knee. His doctor believed that the incident exacerbated his preexisting disability by three to four percent. Like Chaparral, Strachan paid respondent for temporary total and temporary partial disability in accordance with the LHWCA but disputed any liability for the permanent partial disability of the knee.

An administrative law judge (ALJ) initially decided this case. It comes to us following an appeal of that decision to the Department of Labor Benefits Review Board. [1463]*1463The AU heard testimony and received other evidence the parties presented. He found that respondent’s 1969 injury caused twenty percent permanent partial disability to his right knee; the 1974 accident, which the AU regarded as compensable under the LHWCA, added ten percent; and the 1978 mishap produced a further four percent. He also found that respondent and Chaparral had settled his claim for permanent partial disability benefits “on the basis of a 10% loss of use of the right leg”. The AU then determined that the LHWCA required compensation of the entire thirty-four percent. He rested his holding on the extra-statutory “aggravation rule”, which provides that an employer must compensate an employee not only for a work injury but also for any pre-existing disability that the injury worsens. See, e.g., Bludworth Shipyard, Inc. v. Lira, 700 F.2d 1046, 1049 (5th Cir.1983) (“We have repeatedly held that an employer takes an employee as he finds him.”) The AU also found that section 8(f)(1) of the LHWCA, 33 U.S.C. § 908(f)(1) (1982), restricted Strachan’s liability to four percent disability, the amount “attributable” to the 1978 accident, and that the second-injury fund owed compensation for the remaining thirty percent. Looking to section 8(c)(2), which specifies 288 weeks as the compensation period for total loss of a leg or its use, and to section 8(c)(19), which allows compensation “for proportionate loss” of a “member” or its use, the AU ordered Strachan to pay four percent of respondent’s compensation rate3 for 288 weeks. He also directed the second-injury fund to disburse thirty percent of the compensation rate for the same length of time after Strachan’s payments ceased.

The Benefits Review Board concluded that legal errors had been made and substantially modified the AU’s decree. Nash v. Strachan Shipping Co., 15 Ben.Rev.Bd.Serv. (MB) 386 (1983). The Board first reduced the thirty-four percent disability that the AU had attributed to the 1978 accident by the ten percent for which respondent had received compensation from Chaparral for the 1974 injury. The Board did not, however, apply this “credit doctrine” to shield Strachan from the twenty percent disability that the 1969 injury generated, and it held Strachan responsible for twenty-four percent.

The Board also found legal error in the AU’s determination that the second-injury fund owed benefits to respondent. It held that the fund operates only after the employer, in accordance with the schedule in section 8(c), has paid benefits for more than 104 weeks. See 33 U.S.C. § 908(f)(1) (1982) (fourth sentence). Sections 8(c)(2) and 8(c)(19), rather than requiring Strachan to pay four percent of the compensation rate for 288 weeks, provide that Strachan must compensate respondent for a period determined by multiplying the percentage of disability and the number of weeks of compensation for total loss of use of a leg. That formula yielded a compensation period of 69.12 weeks (24% of 288 weeks = 69.12 weeks), well short of the 104 weeks that triggers the fund. The Board accordingly ordered Strachan to remit to respondent twenty-four percent of two-thirds of his weekly wage for a period of 69.12 weeks.4

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Related

Strachan Shipping Company v. Nash
782 F.2d 513 (Fifth Circuit, 1986)
Strachan Shipping Co. v. Nash
751 F.2d 1460 (Fifth Circuit, 1985)

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751 F.2d 1460, Counsel Stack Legal Research, https://law.counselstack.com/opinion/strachan-shipping-co-v-nash-ca5-1985.