TIMOTHY J. SCHUTZ, Employee/Petitioner, v. BROOKDALE CHRYSLER PLYMOUTH and WESTERN NAT@L MUT. INS. CO., Employer-Insurer.
WORKERS= COMPENSATION COURT OF APPEALS
JUNE 25, 2007
VACATION OF AWARD - SUBSTANTIAL CHANGE IN CONDITION. Where the evidence submitted showed a significant change in diagnosis, including a failed fusion and a four-level fusion repair, and a substantial change in the employee=s ability to work, from full-time at the time of the settlement to a three and a half year period of inability to work since the first fusion surgery, the employee established good cause to vacate the July 1998 Award on Stipulation.
Vacation of award on stipulation granted.
Determined by: Johnson, C.J., Pederson, J. and Rykken, J.
Attorneys: David M. Bialke, Law Office of David M. Bialke, Fridley, MN, for the Petitioner. Radd Kulseth, Aafedt, Forde, Gray, Monson & Hager, Minneapolis, MN, for the Respondents.
THOMAS L. JOHNSON, Judge
The employee petitions to vacate an Award on Stipulation, served and filed July 8, 1998, on the grounds of a mutual mistake and/or an unanticipated change in medical condition since the time of the award. Concluding the employee has established good cause to vacate the award, we grant the petition.
Timothy J. Schutz, the employee, sustained a personal injury to the low back on April 26, 1993, while working as an auto technician for Brookdale Chrysler Plymouth, the employer, then insured by Western National Mutual Insurance Company. The employer and insurer admitted liability and paid workers= compensation benefits including wage loss benefits, medical expenses, and permanent partial disability of 10.5% to the body as a whole.
The employee was initially diagnosed with a lumbar strain/sprain with multilevel degenerative disc disease, for which he received conservative treatment. Following the injury, he was off work for about two weeks, then returned to light-duty work for the employer. In October 1993, the employee was assigned permanent work restrictions of no lifting over 35 pounds, avoid repetitive bending, twisting and stooping, and allow frequent changes of position. The employee was unable to return to work as an auto mechanic/technician, but accepted a permanent, full-time position with the employer as a warranty manager, commencing on December 1, 1993.
The employee continued to experience periodic flare-ups of back and leg pain. A November 20, 1996, MRI scan showed herniated discs at L3-4 and L4-5 causing pressure on the nerve roots bilaterally. On January 2, 1997, he was seen in consultation by Dr. Timothy Garvey, an orthopedic surgeon. The employee reported 70% leg pain and 30% back pain, with bilateral great toe weakness and left ankle weakness on examination. The doctor concluded a decompression surgery without fusion was a reasonable option to treat the employee=s leg pain, with non-operative, conservative treatment for his back pain. Dr. Garvey advised the employee that, as the primary treatment for back pain, a fusion operation should be seen as a last resort.
The employee returned to his treating orthopedist, Dr. Paul Crowe, who performed the surgery on February 20, 1997, consisting of a bilateral decompression at L3-4 and L4-5 with disc excisions on the left at L3-4 and on the right at L4-5. At the two week post-operative follow-up, the employee=s legs felt better and Dr. Crowe stated the employee was doing well. The doctor released the employee to return to work, half days, on March 10, 1997. The employee returned to his work as a warranty manager for the employer.
The employee was examined on March 25, 1997, by Dr. Richard Strand, an orthopedic surgeon, at the request of the employer and insurer. The employee reported feeling somewhat better and had no significant leg pain, but continued to complain of low back pain. Dr. Strand diagnosed multilevel degenerative disc disease, and opined the employee did not meet the criteria for a surgical decompression due to herniated discs. The doctor stated that patients with multilevel degenerative discs Ararely have successful outcomes of simple surgical procedures such as decompressions without stabilization,@ noting, however, that stabilization is difficult because of the multilevel disc involvement. He expected the employee would continue to have back pain that would be disabling to him. (Pet. Ex. G, Resp. Ex. 2.)
On May 6, 1997, the employee was seen in follow-up by Dr. Crowe who noted the employee was doing quite well, A[h]is legs feel great@ and his back was feeling better. The doctor described the surgery as Aan unequivocal success,@ and released the employee to return to his regular, full-time work with the same restrictions he had pre-operatively. No additional treatment was prescribed, and the employee was to return on an as needed basis only. (Pet. Ex. E.)
In a letter report dated October 28, 1997, Dr. Crowe opined the employee had reached maximum medical improvement, again stating the surgery had been an Aunqualified success.@ The doctor provided a permanent partial disability rating of 16% for a herniated disc with a second herniated disc at an adjacent level treated concurrently. (Pet. Ex. F.)
The employee filed a claim petition in October 1997, seeking medical expenses related to the February 1997 surgery, temporary total disability benefits for a short period following the surgery, additional permanency benefits and rehabilitation assistance. The employer and insurer denied liability. In June 1998, the parties entered into a stipulation for settlement. The stipulation provided for a lump sum payment to the employee of $4,125.00 in return for a full, final and complete settlement of all claims arising out of the employee=s April 26, 1993, personal injury except causally related, reasonable and necessary future medical expenses. An Award on Stipulation was served and filed on July 8, 1998.
The employee continued to work as a warranty/service manager, full-time, through the fall of 2003. There is nothing in the record evidencing any low back treatment from May 1997 until August 2003, when the employee returned to Dr. Crowe reporting progressively worsening back and leg pain.
In October 2003, the employee was referred to Dr. Eric Flores, a neurosurgeon, by his family physician. The employee reported slowly increasing pain in his back and thighs over the past year or so, which had become much more severe in the past two months. MRI and CT/myelogram studies revealed multilevel degenerative disc disease from L3 to S1, and a left-sided disc herniation with lateral recess stenosis at L4-5. Dr. Flores diagnosed lumbar spondylosis, L4-L5 spondylolisthesis and an L4-5 disc protrusion, and recommended surgery. On February 11, 2004, the employee underwent an L4-L5 posterior fusion with pedicle screw instrumentation and an L4-5 decompression and microdiscectomy.
The employee initially experienced some relief, but his back and leg pain progressively worsened, becoming more intense. The employee filed a claim for Social Security disability benefits, and on January 18, 2005, Dr. Crowe provided a note stating the employee had a failed spinal fusion with chronic pain. The doctor opined the employee was permanently disabled from working, and stated there was nothing else to do for him at that point.
On January 28, 2005, the employee was examined by Dr. Mark Thomas at the request of the employer and insurer. Dr. Thomas opined the injury of April 1993 was a substantial contributing cause of the need for surgery in 2004. The doctor believed the employee=s increasing symptoms in 2003 were likely the result of progressive degeneration at the L4-5 disc level, not addressed by the decompression surgery in 1997. Dr. Thomas further opined the employee had reached maximum medical improvement, indicating the fusion was most likely solid.
The employee returned to Dr. Crowe in March 2005. Noting the employee continued to have a lot of pain, the doctor provided a referral for an evaluation of the spinal fusion. He continued the employee off work, again indicating the employee was permanently disabled.
The employee was examined by Dr. Ensor Transfeldt, an orthopedic surgeon, in July 2005. The doctor diagnosed multilevel disc degeneration with associated severe, disabling mechanical low back pain, and a possible failed fusion. A CT/myelogram study revealed a likely nonunion at the L4-5 level, and Dr. Transfeldt suggested multilevel fusion surgery to repair the nonunion or pseudoarthrosis. In a November 2005 office note, Dr. Transfeldt stated the employee would have permanent restrictions whether he had the surgery or not, including avoidance of activities that require repetitive bending, lifting and twisting, and the ability to stand and change positions on a regular basis.
On January 26, 2006, the employee was found eligible for Social Security disability benefits on the basis of degenerative disc disease with radiculitis/stenosis, status post-fusion with nonunion, and mild anxiety, effective September 22, 2003.
On February 2, 2006, Dr. Transfeldt performed an anterior lumbar discectomy and fusion, L3 to S1, with interbody allograft spacers, anterior allograft bone graft, removal of deep lumbar implants at L4-L5, posterior spinal instrumentation L3 to S1, and L3 hemilaminotomy and decompression of the traversing left L4 nerve root. The employee reported significant relief of his pain one month post-op. By May 2006, it appeared the fusion was beginning to be incorporated, and the employee was referred for physical therapy. The employee was discharged from physical therapy on August 21, 2006, reporting moderate pain (4/10) with activity. He was able to drive for 45 minutes, walk for 15 minutes, lift up to 10 pounds, and continued to wear a lumbar brace during activity. The employee was noted to be able to self-manage his symptoms, and was instructed in a home exercise program.
The employee filed a petition on September 29, 2006, seeking to set aside or vacate the July 8, 1998, Award on Stipulation on the basis of a mutual mistake of fact or a substantial change in medical condition. The employer and insurer object.
This court has authority to set aside an award on stipulation upon a showing of good cause. Minn. Stat. '' 176.461 and 176.521, subd. 3. Good cause includes Aa mutual mistake of fact@ or Aa substantial change in medical condition since the time of the award that was clearly not anticipated and could not reasonably have been anticipated at the time of the award.@ Minn. Stat. ' 176.461(1) and (4).
1. Mutual Mistake of Fact
The petitioner contends that, at the time of the award on stipulation, none of the parties to the settlement anticipated the employee would be off work for an extended period of time or the employee might become permanently and totally disabled. He argues that all of the parties mistakenly assumed the employee would be able to continue working, that this assumption is reflected in the total payment of $4,125.00 to the employee, and that it constitutes a mutual mistake of material fact justifying vacation of the award.
AA mutual mistake of fact occurs when opposing parties to the stipulation both misapprehend some fact material to their intended settlement of a claim or claims.@ Selton v. Schwann=s Sales Enters., 53 W.C.D. 110, 113 (W.C.C.A. 1995). We do not believe the employee=s ability to continue working indefinitely into the future can fairly be characterized as a established fact at the time of settlement. Rather, the parties could, and did, know only that the employee was then capable of working, full-time, in his pre-surgery job with the employer. We believe, instead, the facts peculiar to this case are more appropriately characterized and analyzed as a change in the employee=s condition.
2. Unanticipated, Substantial Change in Medical Condition
ACause@ sufficient to justify setting aside an award on the ground of a change in medical condition exists where there is evidence of a substantial deterioration in the employee=s condition or significant additional disability since the time of the settlement, and a showing of a causal relationship between the injury covered by the award and the employee=s present condition. Davis v. Scott Moeller Co., 524 N.W.2d 464, 51 W.C.D.473 (Minn. 1994). In determining whether an award should be vacated, the claimed change in condition is generally considered in the context of the employee=s diagnoses, the employee=s ability to work, the extent of permanent partial disability, and the anticipated cost and extent of medical care and treatment. Fodness v. Standard Café, 41 W.C.D. 1054 (W.C.C.A. 1989). The inquiry looks back on events, comparing the employee=s condition as it was at the time of the settlement with the employee=s condition at the present time. Davis, id.
Change in diagnosis. The employer and insurer assert there has been no significant change in the employee=s diagnosis since the time of the settlement. They maintain the employee=s diagnosis was multilevel degenerative disc disease at the time of the award and remains multilevel degenerative disc disease at the present time. The respondents argue the employee=s failed fusion and subsequent four-level fusion repair are merely treatment and do not constitute a change in diagnosis. We disagree.
A Adiagnosis@ is a means of characterizing or describing the nature of a disease or medical condition. While the underlying pathology leading to the employee=s surgeries may be the same in this case, there is a substantial difference between multilevel degenerative disc disease successfully treated with a minimally intrusive decompression surgery, and multilevel degenerative disc disease post failed fusion, post four-level fusion surgery.
Prior to the settlement, in February 1997, the employee underwent a bilateral decompression to treat herniated discs at L3-4 and L4-5. The surgery relieved the employee=s leg pain and he was able to return to work, part-time, within two and a half weeks of the surgery. By May 1997, the employee=s legs felt great, his low back felt better, and he was released to return to his regular, full-time work with the same restrictions he had pre-operatively. No additional treatment was prescribed and the employee was to return on an as needed basis only. Dr. Crowe, the employee=s treating surgeon, described the surgery as an unqualified success. At the time the parties settled, in June 1998, the employee had had no treatment for his back for over a year.
No records were submitted evidencing any low back treatment from May 1997 until August 2003, when the employee reported progressively worsening back and leg pain to Dr. Crowe. In October 2003, the employee similarly reported, to Dr. Flores, slowly increasing pain in his back and thighs over the past year or so, which had become much more severe in the past two months. The fusion surgery performed by Dr. Flores in February 2004, failed, leaving the employee with chronic, severe mechanical low back and leg pain. In January 2005, Dr. Crowe opined the employee was permanently disabled.
The employee was seen by Dr. Transfeld on referral from Dr. Crowe, in July 2005, for an evaluation of his fusion. On February 2, 2006, Dr. Transfeldt performed a four-level anterior posterior fusion. The employee reported some relief of his pain following the surgery, and was referred for physical therapy in May. He was discharged from physical therapy in August 2006, reporting persistent moderate pain with activity. While it appears the employee=s condition improved following the second fusion surgery, it is clear that his condition deteriorated significantly in 2003, and remained, for an extended period of time, substantially worse than it was at the time of settlement.
The employer and insurer also argue the employee=s worsened condition could reasonably have been anticipated at the time of the award. They maintain that, prior to the settlement, Dr. Strand stated the employee would continue to have disabling back pain and there was at least some indication that fusion surgery might be needed in the future. Such a possibility would have seemed unlikely at the time of the stipulation, however, given the employee=s good results from the decompression surgery. Moreover, there is nothing in the record to indicate that in 1998 the employee should have or reasonably could have anticipated a failed fusion, the need for a four-level fusion to repair the failed fusion, or the resulting extended period of total disability. Compare, e.g., Swanson v. John C. Weicht & Assocs., No. WC05-225 (W.C.C.A. Jan. 9, 2006).
Change in ability to work. The employee contends there has been a significant change in his ability to work, in that he was working full-time for the employer at the time of the stipulation and is now totally unable to work. Dr. Crowe opined the employee is permanently totally disabled, and the employee has been awarded Social Security disability benefits retroactive to September 2003. The employer and insurer assert, however, the employee mistakenly relies on both Dr. Crowe=s opinion and the Social Security award, as both occurred prior to the February 2006 surgery. They argue the employee=s condition has substantially improved since the fusion repair and that, according to Dr. Transfeldt, the employee will have permanent restrictions similar to those provided before and after the 1997 decompression surgery.
Prior to the settlement, the employee was totally disabled for two short periods only: for about two weeks following the April 26, 1993, injury, and for two and a half weeks following the 1997 surgery. The employee was working full-time for the employer as a warranty manager at the time of the settlement, and continued to work, full-time, as a warranty or service manager through the fall of 2003.
The employee has not worked since the February 2004 surgery. Dr. Transfeldt=s note, referenced by the employer and insurer, was made approximately three months prior to the fusion repair surgery, and was no more than an observation that whether the employee had surgery or not, he would need permanent work restrictions. No evidence was submitted of any release to return to work or new work restrictions since the four-level fusion surgery.
Regardless of the ultimate outcome of the 2006 fusion surgery, even assuming continuing improvement and an eventual release to return to work, the employee has been totally disabled and off work since the fall of 2003 to at least the date of oral argument in April 2007, approximately three and a half years. Clearly, there has been a significant change in the employee=s ability to work since the 1998 stipulation.
Permanent partial disability. The employer and insurer argue the employee is not yet at maximum medical improvement and the extent of any eventual additional permanency is neither provable or rebuttable at present. The employee concedes he has not received a rating for additional permanency, but maintains that two fusion surgeries involving up to four levels will result in additional permanent partial disability. We agree. Minn. R. 5223.0070, subp. 1.D., provides for permanent disability for a fusion surgery.
More extensive medical care. The employer and insurer acknowledge there has been additional costly and extensive medical care, but assert that since future medical expenses were left open by the stipulation for settlement, this factor is of little weight. However, even where medical benefits are left open, the need for more extensive medical care than anticipated may, nonetheless, be useful evidence bearing on whether there has been a substantial change in the employee=s condition. Vellieux v. Catholic Charities, No. WC06-223 (W.C.C.A. Mar. 8, 2007). We find the additional treatment provided in this case significant, and additional evidence of a substantial change in the employee=s medical condition. As discussed previously, we believe the extent and nature of the treatment provided exceeds that which reasonably could have been anticipated at the time of settlement.
Causation. The employer and insurer concede the employee=s current condition is causally related to the April 26, 1993, personal injury.
Based on our review of the record, it appears the employee has suffered a substantial change in medical condition that could not reasonably have been anticipated at the time of the award. We remain mindful that the primary purpose of vacation of an award is to assure compensation proportionate to the degree and duration of disability. Monson v. White Bear Mitsubishi, 663 N.W.2d 534, 63 W.C.D. 337 (Minn. 2003) (citing Franke v. Fabcon, Inc., 509 N.W.2d 373, 49 W.C.D. 520 (Minn. 1993). In this case, the relatively small amount received by the employee in return for a full, final and complete settlement suggests the surgical treatment undergone by the employee since 2003 and the extended period of total disability that followed was neither contemplated by the parties or compensated for in the stipulated settlement. We conclude the employee has established good cause to vacate the Award on Stipulation of July 8, 1998, and grant the petition.
 The employee was paid 225 weeks of temporary partial disability benefits between May 10, 1993, and August 17, 1997, and was no longer eligible for temporary partial compensation. See Minn. Stat. ' 176.101, subd. 2(b).
 Along with payment of $2,161.00 in Roraff fees to the employee=s attorney (see Roraff v. State, Dep=t of Transp. 288 N.W.2d 15, 32 W.C.D. 297 (Minn. 1980)), and $5,603.21 to Healthcare Recoveries/Medica, in partial payment of the intervenor=s reimbursement claim.