Court Opinion

ID: 2743341
Source: CourtListenerOpinion
Date Created: 2014-10-17 14:03:07.178668+00
Date Added: 2024-06-11T10:05:33.760544
License: Public Domain

IN THE SUPREME COURT OF IOWA
                                  No. 13–0665

                           Filed October 17, 2014

GITS MANUFACTURING COMPANY and ST. PAUL TRAVELERS
INSURANCE COMPANY,

      Appellants,

vs.

DEBORAH FRANK,

      Appellee.

      On review from the Iowa Court of Appeals.

      Appeal from the Iowa District Court for Polk County, Karen A.

Romano, Judge.

      An employee seeks further review of a court of appeals decision

reversing her award of benefits by the Iowa Workers’ Compensation

Commission. DECISION OF COURT OF APPEALS AFFIRMED IN PART

AND    VACATED      IN   PART;      JUDGMENT    OF   DISTRICT      COURT
AFFIRMED      IN    PART    AND     REVERSED    IN   PART,   AND    CASE

REMANDED.

      William D. Scherle and Jay D. Grimes (until withdrawal) of

Hansen, McClintock & Riley, Des Moines, for appellants.

      D. Brian Scieszinski of Bradshaw, Fowler, Proctor & Fairgrave,

P.C., Des Moines, for appellee.
                                      2

WIGGINS, Justice.

      An employer and its insurance carrier sought judicial review of an

Iowa Workers’ Compensation Commission decision finding an employee

totally and permanently disabled under the odd-lot doctrine and denying

them certain credits for disability payments previously received by the

employee from other sources.       The district court affirmed, finding the

employee is totally and permanently disabled under the odd-lot doctrine,

but reversed on the issue of credits claimed by the employer and its

insurer.   Both parties appealed.         The court of appeals reversed the

judgment of the district court, holding substantial evidence did not

support the finding the employee is totally and permanently disabled

under the odd-lot doctrine, and the worker’s compensation commission

was correct in its decision concerning the credits. The employee sought

further review, which we granted.

      On further review, we find substantial evidence supports the

commission’s finding that the employee is totally and permanently

disabled under the odd-lot doctrine. In our discretion, we let the court of

appeals decision regarding the employer’s credit for benefits received by

the   employee   from    other   sources     stand    as   the   final   decision.

Consequently, we affirm the judgment of the district court finding

substantial evidence supported the commission’s findings that the

employee is totally and permanently disabled.          We reverse the district

court’s judgment regarding the issues concerning the credit due the

employer for disability benefits received by the employee from other

sources. Therefore, we remand the case to the district court to enter a

judgment    affirming    the   decision    of   the   workers’    compensation

commission’s decision.
                                     3

      I. Prior Proceedings.

      Deborah Frank filed a workers’ compensation claim against her

employer, Gits Manufacturing Company, and its insurer, St. Paul

Travelers Insurance Company. For the sake of brevity, we will refer to

the employer and its insurer as “Gits.”        The workers’ compensation

commission found Frank to be totally and permanently disabled under

the odd-lot doctrine.   The commission denied Gits a credit for social

security benefits and long-term disability benefits received by Frank, and

awarded penalty benefits against Gits. Gits asked for judicial review.

      On judicial review, the district court affirmed the commission’s

finding that Frank is totally and permanently disabled and the award of

penalty benefits.   The district court reversed the commission on the

credit issue and remanded the case to the commission.

      Both parties appealed.     We transferred the case to our court of

appeals. Gits did not appeal the award of penalty benefits. The court of

appeals reversed the district court’s determination that substantial

evidence supported the agency’s award of permanent total benefits. The

court of appeals concluded Gits did not preserve error on its claim Frank

failed to offer adequate evidence of the amount of money she repaid to

the long-term disability carrier because of social security benefits. It also

concluded Gits did not preserve error on the issue of the amount of

credit it was entitled to for the benefits paid to Frank. Thus, the court of

appeals reversed the district court’s determination on those benefits and

any credit due Gits and affirmed the commission’s decision on these

issues.   However, because the court of appeals reversed the district

court’s determination that substantial evidence supports the agency’s

award of permanent total benefits, it remanded the case to the district
                                     4

court to remand the case back to the workers’ compensation commission

to determine Frank’s disability on the existing record.

      II. Issue.

      When we decide a case on further review, “we have the discretion

to review all or some of the issues raised on appeal or in the application

for further review.” State v. Clay, 824 N.W.2d 488, 494 (Iowa 2012). In

exercising this discretion, we choose only to review the substantial

evidence issue.    Accordingly, the court of appeals decision will be the

final decision on the issues concerning the disability benefits and any

credit due Gits.

      III. Scope of Review.

      The Iowa Administrative Procedure Act requires the district court

to review agency action when a party invokes the district court’s

jurisdiction.   IBP, Inc. v. Harpole, 621 N.W.2d 410, 414 (Iowa 2001)

(citing Iowa Code § 17A.19(8) (1999)). When an appellate court reviews a

district court decision that reviewed an agency action, the appellate

court’s task is to determine if it would reach the same result as the

district court in applying the Act. City of Des Moines v. Emp’t Appeal Bd.,

722 N.W.2d 183, 189–90 (Iowa 2006).

      When the district court reviews an agency action, it may reverse or

modify an agency’s decision if the agency’s decision is erroneous under a

section of the Act and a party’s substantial rights have been prejudiced.

Iowa Code § 17A.19(10) (2011). When dealing with the issue of whether

substantial evidence supports the agency’s findings, the district court

and the appellate court can only grant relief to a party from the agency’s

decision if a determination of fact by the agency “is not supported by

substantial evidence in the record before the court when that record is

viewed as a whole.” Id. § 17A.19(10)(f). Substantial evidence supports
                                     5

an agency’s decision even if the interpretation of the evidence may be

open to a fair difference of opinion. Arndt v. City of Le Claire, 728 N.W.2d

389, 393 (Iowa 2007). Accordingly, the district court and the appellate

court should not consider the evidence insubstantial merely because the

court may draw different conclusions from the record. Id.

      IV. Analysis.

      The court of appeals reversed the district court by discrediting the

evidence that Frank had no reasonable prospect of steady employment in

the competitive labor market.       The commission found credible the

evidence tending to prove Frank had no such prospect of employment.

We have previously announced the legal analysis a district court or

appellate court should use when reviewing an agency decision for

substantial evidence when the credibility of the evidence is involved.

Arndt, 728 N.W.2d at 394–95. There we said in

      [m]aking a determination as to whether evidence “trumps”
      other evidence or whether one piece of evidence is
      “qualitatively weaker” than another piece of evidence is not
      an assessment for the district court or the court of appeals
      to make when it conducts a substantial evidence review of
      an agency decision. It is the commissioner’s duty as the
      trier of fact to determine the credibility of the witnesses,
      weigh the evidence, and decide the facts in issue. The
      reviewing court only determines whether substantial
      evidence supports a finding “according to those witnesses
      whom the [commissioner] believed.”

Id. (citations omitted).

      We agree with the district court that under the legal analysis of

Arndt, substantial evidence supports the commission’s finding Frank is

totally and permanently disabled. At the time of the arbitration hearing,

Frank was fifty-four years old and had completed her education through

the twelfth grade. The parties stipulated Frank sustained a work-related

injury on February 1, 2006. Frank began working at Gits in July 1997.
                                      6

During her time at Gits, Frank worked as a spot welder and an assembly

line worker.   In 2006, Dr. Joel Kline diagnosed Frank with chronic

constrictive bronchiolitis causing shortness of breath or pulmonary

dysfunction after Frank began experiencing respiratory problems in

2002. Dr. Kline placed Frank on medical leave and directed her to stop

working at Gits on February 1. Frank has not been employed outside

the home since February 1 and has not looked for work since that time.

Dr. Kline opined Frank reached maximum medical improvement as to

her pulmonary injury on March 23, 2009.

      The commission based its decision on the odd-lot doctrine.           The

odd-lot doctrine allows the commission to find an employee has suffered

a total disability if the worker can only perform work “so limited in

quality, dependability, or quantity that a reasonably stable market for

them does not exist.” Guyton v. Irving Jensen Co., 373 N.W.2d 101, 105

(Iowa 1985) (internal quotation marks omitted).

      We explained the doctrine in Guyton as follows:

      [W]hen a worker makes a prima facie case of total disability
      by producing substantial evidence that the worker is not
      employable in the competitive labor market, the burden to
      produce evidence of suitable employment shifts to the
      employer. If the employer fails to produce such evidence and
      the trier of fact finds the worker does fall in the odd-lot
      category, the worker is entitled to a finding of total disability.

Id. at 106 (emphasis added). We further explained the doctrine as asking

the question—“Are there jobs in the community that the employee can do

for which the employee can realistically compete?” Second Injury Fund of

Iowa v. Shank, 516 N.W.2d 808, 815 (Iowa 1994). To establish a total

disability, “an employee need not look for a position outside the

employee’s competitive labor market.” Neal v. Annett Holdings, Inc., 814

N.W.2d 512, 524 (Iowa 2012) (internal quotation marks omitted).
                                         7

      The    evidence   supporting     the     commission’s      finding    includes

Dr. Kline’s opinion Frank “has a 26%-50% impairment to the body as a

whole as a result of her abnormal lung condition.”                Dr. Kline further

opined,

      Frank is unable to work in environments that contain
      smoke, dust, fumes or vapors, and her lung function has
      been severely and permanently impaired resulting in
      approximately 50% loss of breathing function which prevents
      her from performing any strenuous work.

      The    lay   testimony,    which       the   commission     found     credible,

supporting the commission’s decision consisted of Frank’s and her

spouse’s testimony that she has good days and bad days.                          The

commission could find on this record that on her “good days,” Frank is

able to do things around the house such as housekeeping, tend her

goats, garden, go for ten to fifteen minute walks, and mow the lawn. On

a bad day, Frank has little energy or stamina and can hardly get off the

couch. Frank testified she has one or two bad days a week and on those
days, she would be unable to work a full eight-hour day.                Frank also

testified she uses an inhaler on a daily basis when things such as

walking or going up and down stairs cause her to have problems

breathing.

      Frank testified she has not sought work since leaving Gits in 2006.

The commission took this fact in consideration when making its

credibility finding by noting Frank did not appear motivated to return to

work, likely due to the money she receives from long-term disability,

workers’     compensation,      and   social       security   disability.     Frank

acknowledged that if she received training she could probably work in a

clerical or receptionist position on her good days, but that she would

need accommodations from any employer due to the number of days she
                                    8

would likely be absent from her job. Frank testified she did not believe

she would be able to work in an office with her injury.

      We have stated “[i]t is a fundamental requirement that the

commissioner consider all evidence, both medical and nonmedical. Lay

witness testimony is both relevant and material upon the cause and

extent of injury.” Miller v. Lauridsen Foods, Inc., 525 N.W.2d 417, 421

(Iowa 1994). Expert medical opinion can be strengthened by lay witness

testimony and this court has “considered lay witness testimony in

determining an employee’s disability and functional impairment.”          Id.

The commission made appropriate credibility findings when it found

Frank established a prima facie case of total disability based on the lay

testimony it found credible together with Dr. Kline’s medical opinions.

      The burden then shifted to Gits to prove availability of suitable

employment.    Gits presented expert evidence from Susan McBroom, a

rehabilitation counselor and licensed mental health counselor, who

performed a vocational assessment on Frank.            McBroom determined

given Frank’s medical restrictions and skills, Frank could consider jobs

in an office environment that are sedentary in nature. Frank testified

she cannot type with both hands and does not currently have the skills

required to work in an office position.   McBroom opined Frank would

need additional training, such as typing and software classes, before an

employer would consider her for a clerical position.

      In   weighing   McBroom’s    testimony,   the     commission   found

McBroom’s testimony and opinions relied heavily upon the premise that

Frank could be retrained with the skills necessary to work in an office

position. The commission further found Gits failed to present evidence

that, taking into consideration age and medical condition, Frank could
                                     9

complete the necessary classes for her to obtain a clerical position. The

commission stated:

      Working around one’s home, setting one’s own schedule, and
      determining one’s own fitness for tasks is quite different
      than working a full-time schedule as an employee of some
      business. While [Frank] has shown ability to undertake
      some tasks around her house and take care of her goats,
      this does not indicate that [Frank] could work outside of her
      home on a regular basis.

Although a different finder of fact may have come to a different

conclusion under this record, we find substantial evidence supports the

commission’s findings Frank is totally and permanently disabled.

      V. Conclusion and Disposition.

      We vacate that part of the court of appeals decision finding

substantial evidence did not support the commission’s findings that

Frank is totally and permanently disabled.     We affirm that part of the

court of appeals decision regarding the issues concerning the disability

benefits and any credit due Gits. Consequently, we affirm the judgment

of the district court finding substantial evidence supported the

commission’s findings that Frank is totally and permanently disabled.

We reverse the district court’s judgment regarding the issues concerning

the disability benefits and any credit due Gits. Therefore, we remand the

case to the district court to enter a judgment affirming the decision of the

workers’ compensation commission’s decision.

      DECISION OF COURT OF APPEALS AFFIRMED IN PART AND

VACATED IN PART; JUDGMENT OF DISTRICT COURT AFFIRMED IN

PART AND REVERSED IN PART, AND CASE REMANDED.