GERALD E. FINSETH, Employee/Appellant, v. BLACKBURN BUILDERS and STATE FARM INS. Co., Employer-Insurer/Cross-Appellants, and OLMSTEAD MED. CTR. and MAYO CLINIC, Intervenors.
WORKERS’ COMPENSATION COURT OF APPEALS
JULY 13, 2010
CAUSATION - PSYCHOLOGICAL CONDITION. Substantial evidence, including expert medical opinion, supports the compensation judge’s finding that the employee’s work-related injuries aggravated and were a substantial contributing cause of the employee’s psychological condition.
PERMANENT PARTIAL DISABILITY - PSYCHOLOGICAL CONDITION. Substantial evidence supports the compensation judge’s award of a 20% permanent partial disability under Minn. Stat. § 176.105, subd. 1(c), and based on Minn. R. 5223,0360, subp. 7.D., for the employee’s psychological condition.
PERMANENT PARTIAL DISABILITY - COMBINED RATINGS; PERMANENT PARTIAL DISABILITY - PAYMENT RATE. The compensation judge properly concluded the employee’s claim for permanent partial disability for his psychological condition was not covered by the parties’ previous stipulation for settlement that specifically mentioned only claims for the lumbar spine and right shoulder. The amount of permanent partial disability claimed in a prior proceeding or the extent of permanency closed out in a prior settlement is not relevant in determining the employee’s additional permanency for his psychological condition. As there was no determination in a previous proceeding of the amount of permanency relative to the lumbar spine and right shoulder, the compensation judge must first determine permanent partial disability for these injuries, combining the ratings using the formula set forth in Minn. Stat. § 176.105, subd. 4, and then calculate the whole body rating for the psychological condition, again combining the 20% with the previously computed permanent partial disability using the statutory formula.
Affirmed in part and vacated and remanded in part.
Determined by: Johnson, C.J., Wilson, J., and Stofferahn, J.
Compensation Judge: Gary P. Mesna
Attorneys: Charles A. Bird, Bird, Jacobsen & Stevens, Rochester, MN, for the Appellant. Cynthia K. Thurston and Jeffrey R. Homuth, McCollum, Crowley, Moschet & Miller, Rice Lake, WI, for the Cross-Appellants.
THOMAS L. JOHNSON, Judge
The employer and insurer cross-appeal the compensation judge’s finding that the employee’s personal injuries aggravated and substantially contributed to the employee’s psychological condition, and the judge’s award of a 20% permanent partial disability for that condition. Both the employee and the employer and insurer appeal the compensation judge’s method of computing the payment due for the 20% permanent partial disability. We affirm in part and vacate and remand in part.
Gerald E. Finseth, the employee, sustained personal injuries on September 20, 1995, November 12, 1998, and November 26, 1998, arising out of his employment with Blackburn Builders, the employer. In unappealed Findings and Order, served and filed November 9, 1999, the employer and its insurer, State Farm Insurance Company, were ordered to pay workers’ compensation benefits to the employee as a result of these personal injuries. By Findings and Order served and filed November 31, 2007, a compensation judge found the employee was permanently and totally disabled by reason of his three personal injuries. The employer and insurer were ordered to pay weekly benefits to the employee.
In November 2001, the parties entered into a stipulation for settlement resolving the employee’s claims for permanent partial disability benefits. The employee claimed entitlement to a 15% whole body disability based upon an injury to the lumbar spine and a 6%, 3%, and 8% permanent partial disability based upon three ratings of the right shoulder. The employer and insurer alleged the employee’s permanent partial disability was at most 16.7% based upon a 15% rating for the lumbar spine and a 2% rating of the right shoulder. They asserted the employee was due no further permanent partial disability benefits because they had already paid the employee for a 16.7% permanent partial disability. To resolve the dispute, the employer and insurer paid the employee $32,500.00 in exchange for a close-out of permanent partial disability to the extent of 31.1% of the whole body.
The employee had a history of psychological symptoms predating his personal injuries. A Minnesota Multiphasic Personality Inventory (MMPI) at the Mayo Clinic in 1981 indicated the employee was mildly depressed and pessimistic. A second MMPI in 1984 noted the employee presented somatic symptoms in a dramatic manner but depression was conspicuously absent.
In January 1995, the employee was seen by Dr. Bachman at the Mayo Clinic. The doctor recorded a history of carpal tunnel syndrome in 1991, and farmer’s lung and asthma. In February 1995, Dr. Kelly diagnosed the employee with Klinefelter’s Syndrome and testosterone was prescribed. In June 1995, Dr. Anderson at the Mayo Clinic noted the employee was having depressive and anxiety symptoms and was under considerable family stress. The doctor reported the employee’s wife had been committed to the hospital for depression and his mother was terminally ill. Dr. Anderson diagnosed depression and prescribed Prozac.
In July 2000, Dr. Bachman noted the employee’s depression had returned but he was feeling better. The employee was continuing to take Prozac. In August 2000, the employee was referred to the pain clinic at the Mayo Clinic for a consultation. Dr. Rome reported the employee’s pain syndrome began with a work injury in 1998 to his right shoulder. The employee reported he limited his activity due to shoulder pain, had poor sleep due to pain, and reported dysphoria, anhedonia, and tearfulness. The employee was treated at the pain rehabilitation center. Upon his discharge in November 2000, Dr. Rome noted the employee was free of pain behaviors and was motivated to continue pain rehabilitation concepts at home.
The employee fell on the ice in December 2003 with resultant persistent right knee pain. In March 2005, the employee underwent a right knee arthroplasty. Five days after his release from the hospital, the employee returned to the Mayo Clinic with excruciating right knee pain. Dr. Sola performed a psychiatric evaluation of the employee and diagnosed adjustment reaction with a history of depression and chronic pain disorder. The employee was admitted to the psychiatric unit. Dr. Lapid evaluated the employee and noted no overt evidence of active depression and no evidence to suggest delirium, dementia, or psychosis. Her diagnosis was adjustment disorder and pain disorder with medical and psychiatric factors. The employee was released from the hospital on April 5, 2005.
In February 2007, the employee began treating with Dr. Ronald Hardrict, a psychiatrist at the University of Minnesota Hospitals and Clinics. In June 2008, the doctor referred the employee to Dr. Paul Marshall for a neuropsychological evaluation. Dr. Marshall performed a battery of psychological tests and concluded the employee had significant cognitive deficits, including attention deficits. From the standpoint of cognitive functioning, Dr. Marshall concluded the employee was incapable of truly independent living and would need the assistance of friends, family, or professional staff for money management, major decisions, and complex aspects of housekeeping. By report dated March 11, 2008, Dr. Hardrict diagnosed the employee with major depression, recurrent, characterized by low mood, irritability, insomnia, feelings of hopelessness, inattention, poor concentration, impulsivity, and difficulty with task completion and organization. The doctor opined the employee’s depression and anxiety were causally related to his work injuries and associated chronic pain. Dr. Hardrict opined the employee was permanently disabled as a result of his medical and psychiatric conditions and would require life-long treatment with a guarded prognosis. Dr. Marshall opined the employee qualified for a permanent partial disability rating of 65% under Minn. R. 5223.0360, subp. D.
In March 2008, the employee began treating with Dr. Paul Fountain at Psychological Consultants. The doctor diagnosed depressive disorder, learning disorder, and possible cognitive disorder. By report dated November 4, 2009, Dr. Fountain opined the employee’s depression and anxiety were causally related to his work injuries and rated a 70% permanent partial disability.
Dr. Thomas Gratzer performed an independent psychiatric evaluation of the employee in January 2009 at the request of the employer and insurer. The doctor diagnosed dysthymia, generalized anxiety disorder, history of major depression in remission, cognitive disorder not otherwise specified, history of delirium resolved, and dependent and avoidant personality traits. Dr. Gratzer opined the employee did not develop any psychiatric sequela caused by the November 12, 1998, personal injury, and opined the employee’s dependent and avoidant personality traits, generalized anxiety disorder, and dysthymia predated the September 20, 1995, personal injury. Dr. Gratzer disagreed with Dr. Hardrict’s 65% permanent partial disability rating and opined the employee did not demonstrate a moderate to severe emotional disturbance present at all times. Rather, Dr. Gratzer stated the employee had chronic low grade depressive and anxiety symptoms without psychiatric impairment.
The employee brought a claim for permanent partial disability benefits for a mental condition. Following a hearing, a compensation judge found the employee suffered from a psychological disability substantially caused by the three personal injuries. The compensation judge found the employee’s emotional disturbance is present at all times but is only mild in nature and the employee can live independently and relate to others. The compensation judge rated the employee with a 20% whole body disability for the psychological impairment. The compensation judge combined this 20% permanent disability rating with the 16.7% permanent disability previously paid by the employer and insurer and applied the statutory formula of Minn. Stat. § 176.105, subd. 4, which resulted in a combined rating of 33.6%. The compensation judge ordered the employer and insurer to pay to the employee permanent partial disability benefits for a 33.6% whole body disability less the 16.7% permanent disability previously paid. The employee appeals the compensation judge’s method of computing the payment due for the 20% permanent partial disability for his psychological condition. The employer and insurer cross-appeal the compensation judge’s finding that the employee’ psychological condition is causally related to the employee’s personal injury and also appeal the compensation judge’s method of computing liability for any additional permanent partial disability.
1. Psychological Condition - Contributing Cause
The employer and insurer contend the evidence is insufficient to establish a causal relationship between the employee’s personal injuries and his psychological condition. They acknowledge the employee sustained serious physical injuries to his low back and right shoulder and admit these injuries have had a continuing effect on the employee’s lifestyle. However, the appellants assert the employee has exhibited a pattern of psychological problems throughout his life. They point to Dr. Gratzer’s opinion that the employee had dependent and avoidant personality traits, a generalized anxiety disorder, and dysthymia, all of which predated his personal injuries. The principal stressors, the appellants argue, were the employee’s loss of his job in 2004 following the December 2003 injury, and the employee’s pain response following the right knee surgery in 2005. It was not until after these events, the appellants assert, that the employee began treating for depression. Therefore, the appellants argue, the personal injuries were not substantial contributing causes of the employee’s psychological condition and the compensation judge’s decision to the contrary must be reversed. We disagree.
There is evidence in the record to support the appellants’ position that the work injuries were not substantial contributing causes in the development, aggravation, or acceleration of the employee’s psychological condition. Under this court’s standard of review, however, the issue is not whether the evidence will support alternative findings, but whether substantial evidence supports the judge’s factual findings. Where evidence conflicts or more than one inference can be drawn from the evidence, the compensation judge’s findings must be upheld. Redgate v. Sroga’s Standard Serv., 421 N.W.2d 729, 40 W.C.D. 948 (Minn. 1988).
The employee self-reported a long history of anxiety and depression prior to his work injuries. Additionally, the employee has had to deal with a large number of medical problems in his life, many of which were not work-related. However, as the compensation judge noted, the employee was able to function at work and manage these problems until he sustained his three work injuries. Thereafter, the employee’s psychological condition worsened. The testimony of the employee and his wife support this conclusion. Both Dr. Hardrict and Dr. Fountain opined the employee’s depression and anxiety were aggravated by and were causally related to his work injuries. Both doctors obtained histories from the employee, reviewed his medical records, and evaluated the employee on numerous occasions. Thus, each had adequate foundation for his opinion and the compensation judge could reasonably rely upon their opinions. See Grunst v. Immanuel-St. Joseph Hosp., 424 N.W.2d 66, 40 W.C.D. 1120 (Minn. 1988). Substantial evidence, therefore, supports the compensation judge’s conclusion that the personal injuries were a substantial and contributing cause of the employee’s psychological condition. We affirm.
2. Permanent Partial Disability Rating
The compensation judge found the employee has a 20% permanent partial disability as a result of his work-related psychological problems. The employer and insurer appeal this finding contending the opinions of Dr. Hardrict and Dr. Fountain are insufficient to support an award of permanent partial disability benefits. They argue Dr. Hardrict incorrectly cited to Minn. R. 5223.0360, subp. D., rather than subp. 7.D. of the rule. Further, Dr. Hardrict rated a 70% permanent partial disability, a level of permanent disability not contained within the rule. Dr. Fountain, the appellants assert, confused physical and psychological symptoms in rating permanent disability. Accordingly, the appellants argue the compensation judge could not rely on the reports of either Dr. Hardrict or Dr. Fountain to establish psychological symptoms entitling the employee to permanent partial disability. Further, the employer and insurer contend the employee’s testimony failed to support his claim for a psychological impairment because nearly all of his testimony at hearing related to physical ailments only. For these reasons, the appellants contend the compensation judge’s award of permanent partial disability was erroneous. Again, we are not persuaded.
Dr. Hardrict diagnosed the employee with major depression characterized by a low mood, irritability, insomnia, feelings of hopelessness, inattention, poor concentration, impulsivity, and difficulty with task completion and organization. The doctor further noted the employee’s cognitive impairment was sufficient to impair his ability to read, write, and engage in conversation. Dr. Fountain diagnosed the employee with depression and anxiety that resulted in symptoms such as insomnia, poor appetite, low energy, and poor memory and concentration. The reports and records of these two doctors provide substantial evidentiary support for the judge’s conclusion that the employee has emotional disturbances and personality changes causing permanent impairment of function.
The worker’s compensation permanent partial disability schedules, Minn. R. 5223.0010, et. seq., contain no ratings for emotional disturbances or personality changes not due to organic brain dysfunction. Therefore, permanent partial disability is rated under Minn. Stat. § 176.105, subd. 1(c). In Norman v. Diamond Risk Corp., No. WC04-280 (W.C.C.A. Feb. 25, 2005), this court held that Minn. R. 5223.0360, subp. 7.D., may be used in rating permanent partial disability for depression. Although Dr. Hardrict misstated the applicable rule, the compensation judge rated the employee’s disability under the correct rule. The judge concluded the employee had mild emotional disturbance present at all times but was able to live independently and relate to others, and awarded the employee a 20% whole body disability. Again, substantial evidence of record supports the compensation judge’s decision and it is affirmed.
3. Payment of Permanent Partial Disability Benefits for Psychological Impairment
The compensation judge found the employee sustained a 20% whole body disability for his psychological impairment. To compute the level at which this permanent partial disability is payable under Minn. Stat. § 176.101, subd. 2a, the compensation judge added the 20% disability to the 16.7% permanent disability previously paid the employee and applied the statutory formula at Minn. Stat. § 176.105, subd. 4, which resulted in a total permanency rating of 33.6%. The compensation judge ordered the employer and insurer to pay to the employee permanent partial disability benefits for a 33.6% whole body disability less the 16.7% permanent disability previously paid. Both parties appeal the compensation judge’s method of computing the permanent disability benefits payable to the employee.
The employer and insurer contend they should be given credit for the 31.1% permanent partial disability close-out contained in the 2001 settlement. That is, the appellants contend they are liable for no more than the difference between the 33.6% whole body disability found by the judge and the 31.1% permanent disability closed out in the settlement. We disagree.
In Sweep v. Hanson Silo Co., 391 N.W.2d 817, 39 W.C.D. 51 (Minn. 1986), the supreme court held a proposed stipulation for settlement was broader than statutorily permissible because it purported to close out claims for work-related injuries for which the “employee has made no claim based on such injuries, and they were not a subject of dispute between the parties.” Id. at 822, 39 W.C.D. at 57. Following Sweep, this court in multiple cases has stated a settlement may not foreclose claims not contemplated by the parties at the time of the settlement. In Fitzsimmons v. Alberta Gas Chems., Inc., slip op. (W.C.C.A. June 27, 1995), this court concluded a stipulation that closed out all claims arising out of a 1982 injury did not bar a subsequent claim for benefits for a low back condition alleged to be due to the 1982 injury when the stipulation did not refer to a low back condition and described the injuries as being burns. In Fitzsimmons, the court stated, “A stipulation for settlement covers only those claims or rights that are specifically mentioned in the agreement.”
In this case, the only claims for permanent partial disability specifically mentioned in the settlement document were claims based upon injuries to the lumbar spine and the right shoulder. The 2001 settlement agreement contains no reference to claims for psychological impairment caused by the personal injuries. Accordingly, the settlement of the claims for permanent partial disability of the shoulder and lumbar spine do not constitute a credit against the employee’s entitlement to 20% permanent partial disability benefits for a psychological impairment.
We next deal with the question of the amount of money due the employee for the 20% permanent disability for his psychological impairment. The employee sustained three personal injuries, each of which was found to be a substantial contributing cause of the permanent psychological impairment. To determine the percentage of permanent partial disability to which the employee is entitled for the psychological impairment and the level at which it is payable under the disability table at Minn. Stat. § 176.101, subd. 2a, the permanent disability resulting from each injury must be combined using the formula of Minn. Stat. § 176.105, subd. 4.
In a prior proceeding, the employee claimed entitlement to permanent partial disability of 15% relative to the lumbar spine and 17% based upon three ratings of the right shoulder. The employee’s claims were settled so there was no determination of the actual permanent partial disability relative to the employee’s lumbar spine and right shoulder. Accordingly, the compensation judge must first determine the amount of permanent partial disability of the lumbar spine and right shoulder which the employee had at the time of the award and combine these ratings using the formula of Minn. Stat. § 176.105, subd. 4. The percent of the whole body permanently impaired due to the psychological condition and the level at which it is payable is then determined by combining the 20% permanent partial disability with the previously computed disability using the formula of Minn. Stat. § 176.105, subd. 4. The 20% permanent partial disability for the employee’s psychological condition is reduced by the statutory formula and that reduced percentage of disability is payable at the level for the total combined disability.
Finding 12 and Order 1 are vacated and the case is remanded to the compensation judge to recompute the permanent partial disability benefit owed the employee. To resolve this issue, the compensation judge may, in his discretion, reopen the record to receive further evidence.
 The employer and insurer contended the A + B (1-A) formula of Minn. Stat. § 176.105, subd. 4, was applicable.
 See also Weber v. City of Inver Grove Heights, 461 N.W.2d 918, 43 W.C.D. 471 (Minn. 1991).
 See, e.g., Gates v. Costco Wholesale, No. WC04-201 (Jan. 14, 2005); Buske v. State, Dep’t of Human Servs., slip op. (W.C.C.A. Nov. 5, 1999); Golen v. J.C. Penny Co., slip op. (W.C.C.A. Oct. 7, 1993); Munkelwitz v. Bladholm Bros., slip op. (W.C.C.A. July 28, 1993).
 Compare, e.g., Matykiewicz v. General Tire, 69 W.C.D. 272 (W.C.C.A. 2009) (the issue is not what rating previously may have been assigned to the employee’s preexisting condition or even the rating for which the employee received payment, rather the issue is the actual extent of the employee’s permanent impairment); Settlemire v. Innsbruck Health Care Ctr., 69 W.C.D. 155 (W.C.C.A. 2009) (where the employee’s permanent partial disability from her previous work injuries was not previously rated in any proceeding, the compensation judge is required, first, to rate the preexisting disability); Addington v. Allina Health Sys., 69 W.C.D. 94 (W.C.C.A. 2009) (the amount of permanent partial disability claimed in a prior proceeding or the extent of permanency closed out in a prior settlement is not relevant; rather, the compensation judge must determine the extent of the employee’s entire permanent partial disability if the disability has not been rated in another proceeding).