Casualty Insurance v. Industrial Accident Commission

The question to be determined here is whether an award by the Industrial Accident Commission of permanent disability indemnity based on a different occupation of the applicant than that agreed upon by the parties was in excess of the commission’s jurisdiction and constituted a denial to the employer and its carrier, petitioners herein, of due process of law. We point out that the proceedings in controversy were properly and timely commenced pursuant to

We set forth the following chronology of the pertinent events: On March 31, 1958, M. Robert Felton, applicant below and respondent herein, sustained an industrial injury to his back while employed by petitioners John C. McEnery, Robert F. Benson and Alden French doing business as Farmers Union Hardware, hereafter referred to as Farmers. On November 25, 1958, Felton filed an application with respondent Industrial Accident Commission against Farmers and the latter’s insurance carrier Casualty Insurance Company of California, also a petitioner herein, hereafter referred to as Casualty, seeking a determination of liability for temporary disability, medical treatment, medical costs and litigation expense but not of permanent disability. In said application, applicant alleged that at the time of his injury he was employed “as a manager of hardware Dept.” On December 2, 1958, Casualty filed its answer in letter form stating inter alia therein that “ [w]hen this matter comes on for hearing, we anticipate raising the following issues: (1) Injury. (2) Nature and extent of disability. (3) Need and liability for further medical treatment. (4) Age.' ’

On December 11, 1958, the matter came on for hearing, at which time it was admitted inter alia that on the date of the injury applicant was employed by Farmers as department manager. On February 26, 1959, a further hearing was held at Casualty’s request in order to permit said carrier to cross-examine applicant’s medical witness and introduce evidence in rebuttal to such witness’ report. On March 5, 1959, the commission issued findings and award, determining among other things that the injury caused temporary partial disability and awarding applicant temporary disability indemnity, reimbursement for medical litigation expense and further medical treatment. Included among the findings of fact was the finding that applicant “while employed as department manager” by Farmers sustained the injury in question.

On November 16, 1960, applicant filed his petition for per

The petition for permanent disability rating in the instant case was filed on November 16, 1960, and well within the five-year period. This properly invoked the jurisdiction of the commission on the issue of permanent disability and empowered the commission to continue its jurisdiction beyond the five-year period in order to make a determination thereon. The issuance of findings and award on August 16, 1963, was therefore not an act in excess of jurisdiction even though not accomplished until after the five-year period.

A similar problem confronted the court in American Can Co. v. Industrial Acc. Com. [Cacioppo] (1961) 196 Cal.App. 2d 445 [ 16 Cal.Rptr. 424 ], There the applicant, a millwright, sustained an injury and received an award for permanent disability, the commission finding that the injury caused no temporary disability. A year and a half later he sustained a second injury while working for the same employer as a sealer and stacker of cartons. The classification of a millwright was in a much higher occupational group in the commission’s rating schedule than that of a sealer. Evidence was offered by both the applicant and the employer tending to explain the applicant’s change of job assignment. The commission found that the applicant sustained the second injury on the date in question while employed

Petitioners claim that Gacioppo supports them and not respondents. This claim is predicated on the statement contained in the above quoted excerpt that “a determination of the commission may be res judicata in all subsequent proceedings ...” (italics added) in support of which the Scott ease is cited. This does not warrant petitioners’ conclusion that such determinations are necessarily and at all times res judicata nor does the Scott case so hold. On the contrary the Scott case is consistent with the settled rule that since the commission proceeds judicially, its final decisions have res judicata effect. (Scott v. Industrial Acc. Com. (1956) 46 Cal.2d 76 , 83 [ 293 P.2d 18 ]; French v. Rishell (1953) 40 Cal.2d 477 , 480 [ 254 P.2d 26 ]; Goodman Bros. v. Superior Court (1942) 51 Cal.App.2d 297 , 301, 303 [ 124 P.2d 644 ]; Solari v. Atlas-Universal Service, Inc. (1963) 215 Cal.App.2d 587 , 593 [ 30 Cal.Rptr. 407 ].) However, as this court pointed out in Solari, supra, “in view of the

We think that the rationale of the Cacioppo ease applies to the instant one and that in the corresponding finding on the applicant’s injury in the case before us, all that the commission was called upon to find was that Felton was working for Farmers on the critical date. That portion of the finding relating to Felton’s occupation was not material to the issue of temporary disability. It is a general principle of law that a finding as to facts not put in issue by the pleadings and submitted by the parties for decision is meaningless and should be disregarded as surplusage. (Bohn v. Watson (1954) 130 Cal.App.2d 24 , 36-37 [ 278 P.2d 454 ]; Hall v. Hickey (1957) 156 Cal.App.2d 94 ,101 [ 319 P.2d 33 ]; Yost v. Hillcrest Motor Co. (1963) 215 Cal.App.2d 108 , 111 [ 29 Cal. Rptr. 906 ].) Thus when on the subsequent proceedings under section 5410 it was incumbent upon the commission to consider and take into account applicant’s occupation so as to determine the percentage of permanent disability (§ 4660), it was in no way precluded or constrained by the “finding” as to occupation contained in the findings and award issued March 5, 1959. This finding was meaningless and hence no finding at all. The question of applicant’s occupation was open.

Petitioners misconceive the posture of the case and the nature of the commission’s action taken at the time of the findings and award of August 16, 1963. Contrary to petitioners’ claim, such action was not taken upon a petition filed after the expiration of the five-year period to alter or amend a former award and thus in excess of the commission’s juris

Assuming arguendo that the finding of March 1959 as to applicant’s occupation was not meaningless and surplusage, the commission’s action in August 1963 did not offend any rule of res judicata. It is to be noted that the findings and award on the latter date did not contain any provisions expressly altering or amending the earlier finding. Petitioners concede this, as they must because, as we have pointed out, the subsequent proceedings sought a new award and not the amendment of a former one. Petitioners complain, however, that the earlier finding was repealed by implication. As we have explained, the earlier finding, assuming that it had validity, did not have the finality requisite for res judicata at any time within the five-year period. If the subsequent proceedings under section 5410 had the effect of nullifying the finding, this was a result properly effectuated by proceedings within the commission’s jurisdiction.

We therefore conclude that the commission’s action in respect to the proceedings before it under section 5410 was not in excess of its jurisdiction. It remains for us to determine whether its consideration of the issue of applicant’s occupation in the course of such proceedings constituted a denial of due process of law.

Applicant’s petition filed pursuant to section 5410 was heard on January 7, 1963, on the issues of (1) nature, extent and duration of disability and (2) further medical care. At this hearing no evidence was received as to applicant’s occupation at the time of the injury, a necessary element in the first issue as we have already explained. This undoubtedly resulted from the fact that at the beginning of the original hearing the parties in response to a preliminary statement by the referee stipulated that applicant was injured while employed as a department manager. The referee instructed the rating bureau to rate Felton as a “department manager.” However, the commission’s Schedule for Rating Permanent

In Industrial Indemnity Co. v. Industrial Acc. Com. [Hicks] (1961) 57 Cal.2d 123 [ 17 Cal.Rptr. 821 , 367 P.2d 413 ], the applicant sustained an industrial injury to his back while employed as a crane operator. After he returned to work, he was able to operate gantry cranes requiring only one foot for braking but not steam or diesel cranes which required the use of both feet. There was no evidence as to which type of crane he predominantly operated prior to his injury. At the hearing on the issue of permanent disability it was stipulated that applicant was an “operating engineer,” a classification at that time included in the commission’s list of employment categories. The referee instructed the rating bureau to rate Hicks as an operating engineer. In rating Hicks’ disability, however, the rating expert used occupational group 47 (heavy equipment operator) rather than group 50 (gantry crane operator) or group 22 (operating engineer). If he had used either of the last two groups, the rating would have been lower. The referee issued findings and award based on the higher rating of heavy equipment operator. Industrial’s petition for reconsideration based on a claim of error in the classification of Hicks’ employment was granted but the commission although increasing the rating still based it on the same classification. The court annulled the award stating: “Although the commission was not bound to rate Hicks as an operating engineer, it was improper to apply a different classification without providing an opportunity for the presentation of evidence as to the proper classification. Such a procedure is even more important where, as here, the commission did not originate the change in classification, but allowed the rating expert to go beyond the statement submitted for rating and substitute a different classification. [Citation.] Industrial now suggests that Hicks was employed principally as a gantry crane operator, if not as an operating engineer. The commission’s conclusion that there is sufficient evidence in the record to support its finding after reconsideration that Hicks was a heavy equipment

We think that the principle announced in Kicks is controlling in the instant case. Here as in Kicks the parties agreed on the applicant’s occupation and the referee gave instructions for a rating on it. Here as in Kicks the award was based on an occupational classification other than that agreed upon and instructed to be rated. No valid distinction can be found in the fact that here the occupational classification agreed upon is not listed, while in Kicks it was listed, in the commission’s schedule. The important consideration is that the commission used a classification different from that originally described. In Kicks the commission itself had indicated such difference through different occupational group numbers. Here, although the original title of applicant’s job was not specifically listed, the commission’s schedule did list several occupations under the generic title of “manager.” Eschewing these, including listings of manager similar to the title agreed upon (see footnote 2, ante), the commission selected an occupational group under the generic title of “clerk.” Realistically viewed this involved the application of a different classification. As the court points out in Kicks, while the commission was not bound to rate the applicant according to the description of his occupation agreed upon, it was improper for it to apply a different classification without providing an opportunity to present evidence as to the proper classification.

In the instant case applicant requested such an opportunity. Ironically, it was these petitioners who resisted the request. However the basis of their objection was that the effect of any such evidence would be to alter or amend the earlier purported finding of occupation and any such proceeding would thereby be in excess of the commission’s jurisdiction. We have shown this objection to be without merit and the issue of occupation to be properly before the commission in the proceedings under section 5410. On such proceedings the parties were in agreement as to the description of the applicant’s occupation. Clearly petitioners’ purpose in resisting the introduction of testimony on the issue of occupation was to insist that applicant be rated on the similar occupation of retail store manager. Since the commission decided that it would not, as it could not, be bound to rate applicant according to the agreed occupation, it was therefore incumbent upon it to provide for the litigation of the issue rather than

Respondents claim that applicant testified as to his actual duties and activities, that the title of his job was not fully explanatory of the work he performed, that petitioners did not take issue with this testimony, and that the rating made was “clearly within the range of evidence.” As petitioners correctly point out, the simple answer to the above claim is that the parties never regarded applicant’s activities as being in issue. We conclude therefore that the commission should receive and the parties should have an opportunity to present further evidence as to applicant’s proper occupational classification.

The award is annulled and the ease is remanded to the Industrial Accident Commission with directions to take such further proceedings as may be necessary in accordance with this opinion.

Bray, P. J., and Molinari, J., concurred.