Court Opinion

ID: 4295700
Source: CourtListenerOpinion
Date Created: 2018-07-19 13:49:28.301515+00
Date Added: 2024-06-11T14:39:42.938705
License: Public Domain

IN THE COMMONWEALTH COURT OF PENNSYLVANIA

LifeQuest Nursing Center,               :
                        Petitioner      :
                                        :
                  v.                    :
                                        :
Workers’ Compensation Appeal            :
Board (Tisdale),                        :   No. 1250 C.D. 2017
                      Respondent        :   Submitted: February 23, 2018

BEFORE:     HONORABLE P. KEVIN BROBSON, Judge
            HONORABLE ANNE E. COVEY, Judge
            HONORABLE ELLEN CEISLER, Judge

OPINION BY
JUDGE COVEY                                 FILED: July 19, 2018

            LifeQuest Nursing Center (Employer) petitions this Court for review of
the Workers’ Compensation (WC) Appeal Board’s (Board) August 24, 2016 order
modifying the Workers’ Compensation Judge’s (WCJ) decision to include left
sacroiliitis sprain and left leg sprain in the description of Elizabeth Tisdale’s
(Claimant) work injury, reversing the WCJ’s denial of Claimant’s penalty petition
and termination of Claimant’s benefits, and remanding for the WCJ to determine the
penalty amount. Employer presents three issues for this Court’s review: (1) whether
the Board erred by concluding that the issuance of Supplemental Agreements during
a period in which Employer was paying WC benefits pursuant to a Notice of
Temporary Compensation Payable (NTCP) acts as an admission of liability for the
alleged work-related injury; (2) whether the Board erred by failing to conclude that
Employer’s timely filing of a Notice Stopping Temporary Compensation Payable
(NSTCP) and a Notice of WC Denial (NCD) act to preserve all of Employer’s rights,
defenses and obligations with respect to the underlying claim; and (3) whether the
Board erred by concluding that the credible testimony of Robert Mauthe, M.D. (Dr.
Mauthe)1 was not substantial, competent evidence to support the termination of
Claimant’s WC benefits.
              On April 23, 2014, Claimant sustained a left leg sprain when she tripped
and fell over a patient’s wheelchair at work. On May 9, 2014, Employer issued an
NTCP in order to properly investigate the reported work-related injury. On June 27,
2014, Employer filed two Supplemental Agreements2 with the WC Bureau (Bureau)
because Claimant was released to work and Employer made hours available to her.
See Reproduced Record (R.R.) at 214a-217a.            On July 11, 2014, Claimant stopped
working and Employer filed an NSTCP and an NCD. See R.R. at 160a-163a.
              On July 24, 2014, Claimant filed a Claim Petition averring that she
sustained a work injury on April 23, 2014, and a penalty petition alleging that
Employer violated the WC Act (Act)3 by using Bureau documents in an inappropriate
manner and discontinuing her partial benefits in light of the Supplemental
Agreements. WCJ hearings were held on September 3 and December 3, 2014 and
March 4, 2015. On July 28, 2015, the WCJ granted the Claim Petition, in part, and
terminated Claimant’s benefits as of October 9, 2014. The WCJ determined that
Employer was not bound by the Supplemental Agreements because the NSTCP
properly stopped benefits. Specifically, the WCJ concluded:

              This [WCJ] finds the issuance of the Supplemental
              Agreements does not bind [Employer] to the acceptance of
              the work injury. [Employer] issued [an NTCP] on May 9,
              2014 indicating the 90-day period begins on 4/25/14 and
              ends 7/23/14. Two Supplemental Agreements were issued
              modifying Claimant’s benefits as of June 13 and June 20,

       1
          The WCJ expressly found “[t]he testimony of Dr. Mauthe [] credible.” WCJ July 28, 2015
Dec. at 7.
        2
          One Supplemental Agreement modified Claimant’s benefits as of June 13, 2014 and the
other Supplemental Agreement modified Claimant’s benefits as of June 20, 2014.
        3
          Act of June 2, 1915, P.L. 736, as amended, 77 P.S. §§ 1-1041.4, 2501-2708.

                                               2
               2014. The [NSTCP] and [NCD] were both issued on July
               11, 2014. The [NSTCP] and [NCD] were timely issued
               within the 90-day period. By utilizing Supplemental
               Agreements, [Employer] was attempting to document the
               benefits it paid to Claimant upon her return to work while
               the [NTCP] was in effect. There is no document known as
               a ‘Temporary Supplemental Agreement’, and by issuing the
               [Supplemental] Agreements[,] [Employer] reflected the
               benefits it was paying to Claimant during her return to work
               during the initial 90-day period. This [WCJ] finds the
               issuance of the [NSTCP] and [NCD] nullifies the
               Supplemental Agreements and [Employer] had no
               responsibility to pay ongoing benefits after issuing the
               [NSTCP] and [NCD].

WCJ July 28, 2015 Dec. at 6-7.
               Claimant appealed to the Board which, on August 24, 2016, modified
the WCJ’s decision to include left sacroiliitis sprain and left leg sprain in the
description of Claimant’s work injury, reversed the WCJ’s denial of Claimant’s
penalty petition and termination of Claimant’s benefits, and remanded for the WCJ to
determine the penalty. On December 16, 2016, the WCJ issued a decision and
awarded no penalties to Claimant. Employer appealed from the WCJ’s decision to
the Board, asking the Board to reconsider its August 24, 2016 decision or make it
final pursuant to Shuster v. Workers’ Compensation Appeal Board (Pennsylvania
Human Relations Commission), 745 A.2d 1282 (Pa. Cmwlth. 2000).4 On August 17,
2017, the Board made its August 24, 2016 decision final and appealable. Employer
appealed to this Court.5

       4
          The Shuster Court clarified that because a Board decision remanding a matter to the WCJ
is not an appealable final order, after the WCJ’s remand decision, “[t]he party can [] file a motion
with the Board requesting that the Board make its previous order final.” Id. at 1287.
        5
          “On review[,] this Court must determine whether constitutional rights were violated, errors
of law were committed, or necessary findings of fact were supported by substantial competent
evidence.” Stepp v. Workers’ Comp. Appeal Bd. (FairPoint Commc’ns, Inc.), 99 A.3d 598, 601 n.6
(Pa. Cmwlth. 2014).
                                                 3
         Initially, Section 406.1 of the Act6 provides, in relevant part:

         (a) The employer and insurer shall promptly investigate
         each injury reported or known to the employer and shall
         proceed promptly to commence the payment of
         compensation due either pursuant to an agreement upon the
         compensation payable or a notice of compensation payable
         [(NCP)] as provided in [S]ection 407 [of the Act7] or
         pursuant to [an NTCP] as set forth in subsection (d), on
         forms prescribed by the [D]epartment [of Labor and
         Industry (Department)] and furnished by the insurer. The
         first installment of compensation shall be paid not later than
         the twenty-first day after the employer has notice or
         knowledge of the employe’s disability. Interest shall accrue
         on all due and unpaid compensation at the rate of ten per
         centum per annum. Any payment of compensation prior or
         subsequent to an agreement or [NCP] or [] [NTCP] or
         greater in amount than provided therein shall, to the extent
         of the amount of such payment or payments, discharge the
         liability of the employer with respect to such case.
         ....
         (d)(1) In any instance where an employer is uncertain
         whether a claim is compensable under [the Act] or is
         uncertain of the extent of its liability under [the Act], the
         employer may initiate compensation payments without
         prejudice and without admitting liability pursuant to
         [an NTCP] as prescribed by the [D]epartment.
         (2) The [NTCP] shall be sent to the claimant and a copy
         filed with the [D]epartment and shall notify the claimant
         that the payment of temporary compensation is not an
         admission of liability of the employer with respect to the
         injury which is the subject of the [NTCP].            The
         [D]epartment shall, upon receipt of [an NTCP], send a
         notice to the claimant informing the claimant that:
         (i) the payment of temporary compensation and the
         claimant’s acceptance of that compensation does not mean
         the claimant’s employer is accepting responsibility for

6
    Added by Section 3 of the Act of February 8, 1972, P.L. 25.
7
    77 P.S. § 731.
                                           4
               the injury or that a compensation claim has been filed or
               commenced;
               (ii) the payment of temporary compensation entitles the
               claimant to a maximum of ninety (90) days of
               compensation; and
               (iii) the claimant may need to file a claim petition in a
               timely fashion under [S]ection 315 [of the Act], enter into
               an agreement with his employer or receive [an NCP] from
               his employer to ensure continuation of compensation
               payments.
               (3) Payments of temporary compensation shall commence
               and the [NTCP] shall be sent within the time set forth in
               clause (a).
               (4) Payments of temporary compensation may continue
               until such time as the employer decides to controvert the
               claim.
               ....
               (6) If the employer does not file a notice under paragraph
               (5)[8] within the ninety-day period during which temporary
               compensation is paid or payable, the employer shall be
               deemed to have admitted liability and the [NTCP] shall be
               converted to [an NCP].

77 P.S. § 717.1 (emphasis added). Pursuant to Section 121.7a(c) of the Bureau’s
Regulations:

               To modify [an NTCP], Form LIBC-501, an employer
               shall file an amended [NTCP], Form LIBC-501, with the
               Bureau during the 90-day temporary compensation payable
               period. The amended [NTCP], Form LIBC-501, shall be
               clearly identified as ‘Amended’ and may have only the
               insurer’s signature.

      8
         Paragraph 5 refers to the timing, content and effect of NSTCP notices. See 77 P.S. §
717.1(5)(i), (ii), (iii).
                                             5
34 Pa. Code § 121.7a(c) (emphasis added). Under Section 121.17(b) of the Bureau’s
Regulations:

               Termination, suspension, modification or other change in
               compensation may be accomplished by filing with the
               Bureau a Supplemental Agreement for Compensation for
               Disability or Permanent Injury, Form LIBC-337. A
               Supplemental Agreement for Compensation for
               Disability or Permanent Injury, Form LIBC-337, may be
               used to change an Agreement for Compensation for
               Disability or Permanent Injury, Form LIBC-336, a
               Supplemental Agreement for Compensation for Disability
               or Permanent Injury, Form LIBC-337, an Agreement for
               Compensation for Death, Form LIBC-338, a Notice of
               Compensation Payable, Form LIBC-495, or an award. . . .

34 Pa. Code § 121.17(b) (bold and italic emphasis added). Finally, Section 407 of the
Act states:

               On or after the seventh day after any injury shall have
               occurred, the employer or insurer and employe or his
               dependents may agree upon the compensation payable to
               the employe or his dependents under [the Act] . . . .
               Where payment of compensation is commenced without an
               agreement, the employer or insurer shall simultaneously
               give [an NCP] to the employe or his dependent, on a form
               prescribed by the [D]epartment, identifying such payments
               as compensation under [the Act] and shall forthwith furnish
               a copy or copies to the [D]epartment as required by rules
               and regulations. . . .
             All [NCPs] and agreements for compensation and all
             supplemental agreements for the modification,
             suspension, reinstatement, or termination thereof, and all
             receipts executed by any injured employe of whatever age,
             or by any dependent to whom compensation is payable
             under [Section 307 of the Act, 77 P.S. § 561], and who has
             attained the age of sixteen years, shall be valid and
             binding unless modified or set aside as hereinafter
             provided.
77 P.S. § 731 (bold and italic emphasis added).

                                           6
             Employer argues the Board erred by concluding that the issuance of
Supplemental Agreements during a period in which Employer was paying WC
benefits pursuant to an NTCP acted as an admission of liability for the alleged work-
related injury. This case is not the first time this Court has been faced with such an
issue. The dispute with respect to whether a supplemental agreement filed between
an NTCP and the NSTCP and NCD converts the NTCP to an NCP, appears to have
arisen because of the conflict between this Court’s binding precedent in Gereyes v.
Workers’ Compensation Appeal Board (New Knight, Inc.), 793 A.2d 1017 (Pa.
Cmwlth. 2002), and Section 121.7a(c) of the Bureau’s Regulations, 34 Pa. Code §
121.7a(c), later adopted in 2007.
             In Gereyes, it was undisputed that the employer paid the claimant
temporary compensation pursuant to an NTCP from April 11, 1999 until June 29,
1999. On June 29, 1999, the employer sent the claimant an NSTCP and an NCD
within the 90-day period in conformance with the Act. This Court held that in
stopping temporary compensation and denying liability, the employer complied with
the Act, and the NTCP was not converted to an NCP. However, the Gereyes Court
ruled that the employer violated the Act when it unilaterally reduced the amount of
compensation paid pursuant to the NTCP when the claimant returned to work.
Accordingly, although Section 121.7a(c) of the Bureau’s Regulations now requires an
employer to file an amended NTCP with the Bureau during the 90-day temporary
compensation payable period to modify an NTCP, it appears employers are filing
supplemental agreements to comply with Gereyes.
             In the instant case, the Board opined in support of its conclusion that the
Supplemental Agreements were admissions of liability:

             Commonwealth Court has held that pursuant to the terms of
             the Act, supplemental agreements are valid and binding
             unless properly modified or set aside. Sharon Tube Co. v.

                                           7
             [Workers’ Comp. Appeal Bd.] (Buzard), 908 A.2d 929 (Pa.
             Cmwlth. 2006).
             A[n] [NCP], like a compensation agreement, constitutes
             an employer’s admission of liability relating to ‘the
             claimant’s employment, the occurrence of the accident, and
             the nature of the injuries caused by the accident while the
             claimant was in the employ of the employer.’ Beissel v.
             [Workers’ Comp. Appeal Bd.] (John Wanamaker, Inc.), 465
A.2d 969, 972 (Pa. 1983).

August 24, 2016 Board Op. at 3-4 (emphasis added). The Board’s reliance on Sharon
Tube is misplaced. In Sharon Tube, the supplemental agreement at issue was filed to
modify benefits payable pursuant to a WCJ’s award. The Court held that under
Section 407 of the Act, the supplemental agreement was binding. However, NTCPs
are not included in Section 407 of the Act. Section 407 of the Act expressly refers to
“[NCPs,] agreements for compensation and all supplemental agreements for the
modification, suspension, reinstatement, or termination thereof[.]” Id. (emphasis
added). NCPs and agreements for compensation are express acceptances of liability.
Similarly, a WCJ’s award is a determination of liability. An NTCP, conversely, is an
explicit non-acceptance of liability. Because the Supplemental Agreements in the
instant case were entered into to modify an NTCP on the basis of Claimant’s return
to work, Sharon Tube is inapplicable.
             Similarly, the Board’s reliance on Beissel is misplaced. The Beissel
Court held that an NCP filed by an employer who had an opportunity to and did, in
fact, investigate the cause of an employee’s disability, constituted an admission of the
employer’s liability and operated to preclude the employer, under the guise of a
termination petition, from later litigating that which the employer admitted in its
NCP. Here, Employer did not file an NCP or an Agreement of Compensation, nor
did it in any way accept liability. Rather, Employer filed an NTCP which is clearly
provisional. Accordingly, Beissel is also inapposite.

                                           8
               In the instant matter, the Supplemental Agreements do not admit liability
for Claimant’s alleged work injury, and there is nothing in the Act that requires this
Court to interpret them otherwise. Further, the Supplemental Agreements specifically
provide: “The modification is based upon [] Claimant’s medical release to return to
work by h[er] treating physician and [E]mployer making those hours available to
her.” R.R. at 215a, 217a. As the Supplemental Agreements were filed merely to
document the change in Claimant’s WC benefits based on her return to work, this
Court holds they were not admissions of liability and, thus, Employer is not bound by
the injury descriptions therein. Accordingly, the Board erred by concluding that the
Supplemental Agreements represented Employer’s admission of liability for
Claimant’s alleged work-related injury.
               Notably, this Court addressed a similar issue in Frank Martz Coach
Company v. Workers’ Compensation Appeal Board (Avila) (Pa. Cmwlth. No. 1555
C.D. 2015, filed April 13, 2017), wherein, this Court vacated the Board’s order and
remanded for development of the record because “[t]he intentions of either [c]laimant
or [e]mployer cannot be discerned solely from the Supplemental Agreement.” Id.,
slip op. at 11. Specifically, the Court noted that the Supplemental Agreement in that
case stated:

               as fact, that ‘it is now hereby agreed between parties hereto
               that the status of the disability of the said employee
               changed’ on February 28, 2013. R.R. 5a. An ‘x’ is placed
               before ‘Recurred.’ Id. The Supplemental Agreement states
               that [c]laimant will be paid $824.84 per week beginning on
               February 28, 2013, and then recites:
                   Compensation payable for ___UNK ___weeks
                   ___days; or if the future period of disability is
                   uncertain, then to continue at said rate until further
                   changed by supplemental agreement, final receipt,
                   or order of a Workers’ Compensation Judge, or the
                   Workers’ Compensation Appeal Board.

                                            9
             Id. (emphasis added).

Frank Martz, slip op. at 9.9 Based on the above language and the fact that the issue
was not argued before the Referee, the Court could not determine whether the
Supplemental Agreement was in lieu of an amended NTCP or an Agreement for
Compensation, and thus, remanded for an evidentiary hearing. Because there is no
doubt that the purpose of the Supplemental Agreements in the instant case was to
document the change in earnings based on Claimant’s return/release to work, Frank
Martz is distinguishable.
             Herein, the evidentiary record establishes that the Supplemental
Agreements simply documented the change in earnings based on Claimant’s
return/release to work; they did not accept liability. They were not intended to
function as an Agreement for Compensation. The Bureau’s Regulations are clear that
Supplemental Agreements are to be used “to change an Agreement for Compensation
for Disability or Permanent Injury, Form LIBC-336, a Supplemental Agreement for
Compensation for Disability or Permanent Injury, Form LIBC-337, an Agreement for
Compensation for Death, Form LIBC-338, a Notice of Compensation Payable, Form
LIBC-495, or an award[,]” 34 Pa. Code §121.17(b) (emphasis added), and “an
amended [NTCP]” is to be used “[t]o modify [an NTCP], Form LIBC-501[.]” 34 Pa.
Code §121.7a(c). Thus, when modifying an NTCP for any reason other than
accepting liability, the proper filing is an amended NTCP.                Notwithstanding
Gereyes, which preceeded the Board’s Regulation, documenting a change in the rate
of compensation during the 90-day temporary compensation period without accepting
liability, does not require the employee’s agreement. If a claimant disputes the terms
of the amended NTCP for any reason, a claimant may file a review petition with the

      9
       In both cases, the parties used the Bureau’s pre-printed Supplemental Agreement form.
However, the information completed on the forms were different in the two cases.

                                            10
Bureau. Accordingly, an employer does not violate the Act by unilaterally filing an
amended NTCP as required by the Board’s Regulation.
             Here, Employer did not violate the Act by following this Court’s
construction of the Act as set forth in Gereyes. The Board erred in modifying the
WCJ’s decision in this regard. The Supplemental Agreements were not necessary
given the Bureau’s post-Gereyes Regulation that created the amended NTCP, but
Employer did not use them unlawfully or alter its non-acceptance of liability.
Therefore, the Board’s decision on this issue is reversed.
             Employer also contends that the Board erred by failing to conclude that
Employer’s timely filing of an NSTCP and an NCD preserved all of Employer’s
rights, defenses and obligations with respect to the underlying claim. Specifically,
the Board found that because Employer filed two Supplemental Agreements after it
filed its NTCP, the NTCP converted to an NCP, thus, Employer violated the Act
when it filed its NSTCP and NCD, and stopped paying Claimant.
             Section 406.1(5)(iii) of the Act expressly provides:

             If the employer ceases making payments pursuant to [an
             NTCP], [after timely filing the appropriate notices], the
             employer and employe retain all the rights, defenses and
             obligations with regard to the claim subject to the
             [NTCP], and the payment of temporary compensation may
             not be used to support a claim for compensation.

77 P.S. § 717.1(5)(iii) (emphasis added). Because the Supplemental Agreements in
this case were not admissions of liability, and Employer timely filed its NSTCP and
NCD, this Court holds that Employer retained all of its rights and defenses with
respect to the underlying claim.
             Lastly, Employer asserts that the Board erred by concluding that Dr.
Mauthe’s credible testimony was not substantial, competent evidence to support the
termination of Claimant’s WC benefits. Specifically, the Board opined:

                                          11
              [I]n order to be entitled to a termination of Claimant’s
              benefits, [Employer] bore the burden of establishing that
              her entire work injury had fully ceased. While [Employer]
              presented the medical testimony of Dr. Mauthe, he only
              opined that Claimant was fully recovered from a lumbar
              strain work injury. The [WCJ] also only found his
              testimony credible to establish the fact Claimant had fully
              recovered from a lumbar strain. However, as stated earlier,
              we have determined that Claimant’s work injury included
              both ‘left sacroiliitis sprain’ and ‘left leg sprain’ pursuant to
              the binding Supplemental Agreements. Thus, [Employer]
              bore the burden of proving Claimant was also fully
              recovered from those aspects of her work injury to be
              entitled to a termination.

August 24, 2016 Board Op. at 7 (citation omitted).
              However, this Court observes that the WCJ only referred to Claimant’s
lumbar strain because the WCJ properly determined that the Supplemental
Agreements were not binding. Thus, Claimant’s injury did not include both left
sacroiliitis sprain and left leg sprain, but rather, only the injury listed on the NTCP,
i.e., the lumbar strain. Notwithstanding, Dr. Mauthe testified:

              Q. [Employer’s Counsel] Based on your exam, could you
              find anything objectively wrong with her?
              A. [Dr. Mauthe] As it would pertain to any injury sustained
              on 4/23/14, there’s no objective evidence of ongoing
              pathology that I can relate to any work-related
              injury.[10]
              Q. The same thing with your review of the materials that we
              sent to you and the materials you reviewed before testifying
              today: Can you find anything objectively wrong with her as
              it may relate to any alleged work-related incident on April
              23, 2014?
              A. Assuming she strained her back on April 23, 2014, it’s
              my opinion that there’s no longer any evidence of a sac --

       10
          Because Dr. Mauthe had read the medical records and deposition of Claimant’s current
treating neurologist Daniel Skubick, M.D. (Dr. Skubick) prior to his testimony, Dr. Mauthe was
aware of Dr. Skubick’s “left leg pain” diagnosis.
                                             12
            of a lumbar strain or a sacroiliac strain. There’s just no
            focal evidence of impairment. . . .

R.R. at 124a (bold and underline emphasis added). Clearly, because this testimony is
substantial, competent evidence to support the termination of Claimant’s WC
benefits, the Board erred by concluding otherwise.
            For all of the above reasons, the Board’s order is reversed.

                                      ___________________________
                                      ANNE E. COVEY, Judge

                                         13
            IN THE COMMONWEALTH COURT OF PENNSYLVANIA

LifeQuest Nursing Center,              :
                        Petitioner     :
                                       :
                  v.                   :
                                       :
Workers’ Compensation Appeal           :
Board (Tisdale),                       :   No. 1250 C.D. 2017
                      Respondent       :

                                     ORDER

            AND NOW, this 19th day of July, 2018, the Workers’ Compensation
Appeal Board’s August 24, 2016 order is reversed.

                                     ___________________________
                                     ANNE E. COVEY, Judge