Arkansas Court Tackles Question of Insurance Carrier Liability

For the purposes of determining liability, when does a "gradual-onset" injury such as carpal tunnel syndrome legally begin? The Arkansas Court of Appeals ruled Feb. 1 that such an injury begins when the worker becomes aware of the injury.

The question arises out of an appeal filed by Cottage Café Inc. and Farmers Insurance Group after the Arkansas Workers' Compensation Commission ruled that Patricia Collette, a former grill cook at the café, was entitled to workers' compensation benefits for repetitive stress injuries she suffered in 9 years on the job.

On Sept. 29, 2003, Collette dropped a spatula from her hand and was unable to work, according to the appeals court opinion. After seeking medical treatment, Collette was diagnosed with carpal tunnel syndrome and cubital tunnel syndrome.

Just a few weeks before Collette dropped the spatula, Cottage Café had been sold to Leonard Cernak, who switched the café's workers' compensation coverage from Southern Guaranty Insurance to Farmers Group Insurance when he bought the business.

Both insurance companies rejected Collette's workers' compensation claim.

The Workers' Compensation Commission found that Collette was entitled to workers' compensation and that Farmers Insurance was liable for the compensation and benefits awarded.

Farmers Insurance and Cottage Café then appealed the commission's decision, arguing that the commission was wrong in both aspects of its ruling.

Collette's Injuries Were Job-Related

Chief Judge John Pittman, who wrote the appeals court's Feb. 1 opinion, explains that in cases that look at whether someone is entitled to workers' compensation payments, "[w]e will not reverse the commission's decision unless we are convinced that fair-minded persons with the same facts before them could not have reached the same conclusions arrived at by the commission."

For an employee to receive workers' compensation benefits for a gradual-onset injury such as carpal tunnel, Pittman notes, the employee must prove that the injury is job-related, that the injury was severe enough to require medical treatment or cause death or disability and that the injury was a major cause of the disability or need for medical treatment.

Collette testified before the commission that her duties as a grill cook required her to prepare eggs, omelets, hash browns, ham, sausage and bacon and to flip these foods with a spatula as they cooked.

Also, several of Collette's co-workers testified that she was a hard worker, while the mother of the café's prior owner testified that, based on her observations, Collette's injuries undoubtedly are the result of her job duties.

In the opinion of Collette's doctor, her carpal tunnel and cubital tunnel injuries are related to Collette's repetitive motions on the job, and the commission found no evidence suggesting that Collette's injuries resulted from anything else.

In issuing the appeals court's opinion, Pittman weighed this testimony and determined that the Workers' Compensation Commission was correct in ruling that Collette is entitled to workers' compensation for her injuries.

Appeals Court: Commission Ignored Previous Case Law

The second question the appeals court had to answer was whether Southern Guaranty Insurance which was the insurance carrier of the previous owner of the café or Farmers Insurance is liable for Collette's workers' compensation payments and benefits.

The Workers' Compensation Commission looked at it this way: Whichever carrier was providing workers' compensation coverage at the time Collette's injury manifested itself meaning when Collette began to lose time from work and require medical attention and was unable to perform her job is the one responsible for her workers' compensation payments.

Since the injuries to her right wrist and elbow did not manifest itself until Farmers Insurance had become the carrier, the commission ruled that Farmers Insurance was liable for Collette's workers' comp claim.

Pittman, however, blasted the commission for its interpretation, writing, "[t]he commission cites neither authority nor public policy considerations supporting its adoption of this rule."

"Furthermore," Pittman wrote, "it disregards prior opinions of the Arkansas appellate courts that bear on the question under consideration, i.e., when does a scheduled gradual-onset injury legally commence?"

Interpreting Arkansas case law, Pittman concluded that insurance liability for a gradual-onset injury begins when a worker becomes aware of his or her injury. Based on this reasoning, the appeals court reversed the commission's decision and sent the case back to the commission to determine which insurance carrier is liable for Collette's workers' comp payments based on when she became aware of her injuries.

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