Wells v. Swalling Construction Co.

944 P.2d 34, 1997 Alas. LEXIS 115
CourtAlaska Supreme Court
DecidedAugust 15, 1997
DocketNo. S-7509
StatusPublished

This text of 944 P.2d 34 (Wells v. Swalling Construction Co.) is published on Counsel Stack Legal Research, covering Alaska Supreme Court primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Wells v. Swalling Construction Co., 944 P.2d 34, 1997 Alas. LEXIS 115 (Ala. 1997).

Opinion

OPINION

FABE, Justice.

I. INTRODUCTION

At issue in this petition for review is the rate at which the petitioner, Vyron C. Wells, is entitled to receive workers’ compensation [36]*36benefits. The Alaska Workers’ Compensation Board (Board) determined that Wells’s benefits should be calculated based on an injury he suffered to his right knee in 1986. The superior court, rejecting the Board’s application of the last injurious exposure rule, reversed the Board, determining that Wells should receive a lower benefit rate based on an injury to his left knee in 1989. We reverse the superior court, holding that although the last injurious exposure rule does not apply, the Board did not err in determining that Wells is entitled to benefits at the rate established for his 1986 injury.

II. FACTS AND PROCEEDINGS

Wells suffered five on-the-job injuries while working for Swalling Construction Co., Inc., between 1957 and 1989. The details of the last two injuries, one to each knee, are the key facts in this case. In April 1986 Wells injured his right knee when he stepped into a hole and fell. To treat this injury, his physician, Dr. David E. Karges, attempted to decompress the knee cap joint by removing a piece of the patella. After recovering from the surgery, Wells returned to work without restriction in December 1987. However, in an examination seven months after the surgery, Dr. Karges noted that the knee remained symptomatic.

In September 1989 Wells tripped and injured his left knee. He again went to Dr. Karges for treatment. Dr. Karges diagnosed the knee as “sprained with possible minimal avulsion of the quadriceps tendon.” While seeing Dr. Karges about the left knee, Wells spoke with him about continuing problems with the right knee. Dr. Karges concluded that the surgery he performed on Wells’s right knee in 1987 “hadn’t really helped him that much.” On October 12, 1989, Dr. Karges performed a total replacement of the right knee. He also performed diagnostic arthroscopy of Wells’s left knee, but did not provide any treatment for it. He testified at his deposition that while the ar-throscopy of the left knee revealed “early arthritic changes”, there was “no evidence of any mechanical or ligamentous problem.” Wells did not return to work after his knee replacement operation.

After the initial operation on Wells’s right knee, Swalling Construction and Wausau Insurance Co. (collectively, Swalling Construction), compensated Wells at a temporary total disability rate of $885.20 per week for about thirty-three weeks in 1987 and about twelve weeks in 1989. After the total replacement of the right knee, Swalling Construction terminated payments based on the 1986 injury and began making payments of $562.49 per week based on the temporary total disability rate for the 1989 injury. Wells filed applications with the Board for adjustment of his claim to “establish the correct compensation rate” for his disability.

Before the Board, Wells argued that his disability was caused by the 1986 injury, while Swalling Construction argued that it was caused by the 1989 injury. The Board, applying the “last injurious exposure rule,” ruled in favor of Wells. After determining that Wells had rebutted the presumption that his disability was caused by the 1989 injury, the Board concluded that Swalling Construction failed to “prove[] all elements of its claim by a preponderance of the evidence” and ordered Swalling Construction to pay benefits “as they existed on April 30, 1986.” It also ordered Swalling Construction to pay Wells’s attorney’s fees and costs.

Swalling Construction appealed. The superior court reversed the Board’s decision and remanded for redetermination of attorney’s fees. The superior court concluded that the Board erred in determining that Wells had successfully rebutted the presumption that his disability was caused by the 1989 injury. It also determined that the Board incorrectly applied the last injurious exposure rule. Wells petitioned to this court for review.

III. DISCUSSION1

The issue in this case is whether Wells will receive disability benefits based on [37]*37his 1986 injury or his 1989 injury. If his benefit rate is based on the 1986 injury, that rate will be governed by the version of the workers’ compensation laws in effect prior to the 1988 amendments and computed according to Wells’s higher earnings during 1985 and 1986. If his benefit rate is based on the 1989 injury, it will be governed by the law in effect in 1989 and computed according to his lower earnings in 1987 and 1988.2

The Board and the superior court analyzed this dispute by applying the “last injurious exposure rule.” The last injurious exposure rule, announced in Ketchikan Gateway Borough v. Saling, 604 P.2d 590 (Alaska 1979), imposes full liability for a disability on the employer at the time of the most recent injury that bears a causal relation to the disability. Saling, 604 P.2d at 595; see also Parker Drilling Co. v. Wester, 651 P.2d 842, 843-44 (Alaska 1982) (applying the rule to successive insurers). By adopting this rule, we sought to avoid the problems of “apportionment,” the frequently complex and lengthy process of dividing liability among successive employers. Saling, 604 P.2d at 598.

Apportionment unfairly places the burden of adjusting each employer’s share of the liability on the disabled employee rather than the parties actually disputing the successive employers or insurers. See id.; see also Providence Washington Ins. Co. v. Bonner, 680 P.2d 96, 100 (Alaska 1984) (Rabinowitz, J., concurring). It also may prevent workers from receiving adequate compensation when previous insurers or employers are outside the state or insolvent. 4 Arthur Larson & Lex K. Larson, The Law of Workmen’s Compensation § 95.12, at 17-155 & n. 9 (1996). However, in cases not involving successive employers or insurers, these concerns are irrelevant.

Moreover, imposing the rule in such cases would be less equitable than it was in Sal-ing. In Saling, we recognized that “[i]n many cases [the rule] will operate to impose a disproportionately higher burden of liability upon the last employer.” 604 P.2d at 598. We also noted, however, that “[t]he rule will operate in those same cases to create a windfall to previous employers,” id., and that employers may be partially reimbursed by the second injury fund3 for the increased liability caused by “the combined effects of the preexisting condition and the subsequent work-related aggravation.” Id. at 597. Applying the rule in this case, and thus arbitrarily basing Wells’s benefit rate on his last injury, would impose inequities on Wells similar to those imposed on successive employers, as discussed in Saling. However, workers like Wells, in contrast to successive employers, can neither receive a “windfall” nor apply for reimbursement from the second injury fund.

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Bluebook (online)
944 P.2d 34, 1997 Alas. LEXIS 115, Counsel Stack Legal Research, https://law.counselstack.com/opinion/wells-v-swalling-construction-co-alaska-1997.