TROY M. KELLER, Employee, v. PEOPLE SERVS. and EMC INS. COS., Employer-Insurer/Appellants.
WORKERS’ COMPENSATION COURT OF APPEALS
AUGUST 12, 2011
PERMANENT TOTAL DISABILITY - SUBSTANTIAL EVIDENCE. Substantial evidence, including the employee’s testimony, his medical records, and expert medical and vocational opinions, supported the compensation judge’s conclusion that the employee was permanently and totally disabled, despite the fact that the employee was able to work part time at a very low stress job.
ATTORNEY FEES - EXCESS FEES. Where the employee’s attorney had already received a $13,000 contingent fee as a result of previous proceedings, the compensation judge erred in awarding another contingent fee, and remand was required so that the judge could consider the employee’s entitlement to fees pursuant to Irwin v. Surdyk’s Liquor, 599 N.W.2d 132, 59 W.C.D. 319 (Minn. 1999).
Affirmed, in part, vacated, in part, and remanded.
Determined by: Pederson, J., Johnson, J., and Milun, C.J.
Compensation Judge: Danny P. Kelly
Attorneys: Rodney C. Hanson, Anderson, Larson, Hanson & Saunders, Willmar, MN, for the Respondent. Gary M. Hagstrom, Koll, Morrison, Charpentier & Hagstrom, St. Paul, MN, for the Appellants.
WILLIAM R. PEDERSON, Judge
The employer and insurer appeal from the compensation judge’s finding that the employee is permanently and totally disabled. We affirm that finding but vacate the judge’s order for attorney’s fees and remand the matter to the judge for reconsideration.
On May 13, 2005, Troy M. Keller [the employee] was struck in the head and knocked unconscious by a large high pressure hose while working for People Services [the employer], a wastewater management company. The employee, who had then worked for the employer for about five years, was taken by ambulance to Cambridge Medical Center and diagnosed with head trauma/concussion. The employer and its workers’ compensation insurer, EMC Insurance Companies, admitted liability for the employee’s injuries and paid wage loss and medical benefits. On the date of his injury, the employee was 35 years old and was earning a weekly wage of $778.26.
The employee had received some treatment for anxiety and mild depression prior to his work injury. However, whatever symptoms the employee experienced prior to his injury did not interfere with his ability to work or to obtain the necessary certificates and licenses to become a wastewater operator. Following his head injury, the employee experienced a worsening of his anxiety and depression, along with severe headaches and memory loss. His memory problems caused him to make mistakes on the job and resulted in a written warning concerning his job performance.
The employee chose to resign from his job with the employer in September 2005. Thereafter, he was able to obtain two more jobs in wastewater management, but he lost both jobs due to ongoing cognitive difficulties. In December of 2005, the employee was admitted for an 18-day hospitalization at Lake Region Healthcare in Fergus Falls, where he was treated by psychiatrist Dr. Daniel Traiser for acute depression, anxiety, and suicidal thoughts. The employee continued to treat with Dr. Traiser after that admission but nevertheless continued to struggle with vocational stresses in his next job, and he was again hospitalized for acute depressive symptoms, for approximately 28 days, in August 2006.
On March 15, 2007, the employee was seen by neuropsychologist Dr. George Montgomery at the Sister Kenny Institute Brain Injury Clinic. After performing a neuropsychological assessment, Dr. Montgomery concluded that the employee had not recovered from his 2005 head injury. The doctor found a mild impairment of neuropsychological abilities and diagnosed “late effects of head injury” and “organic brain syndrome.” On April 25, 2007, the employee’s treating neurologist, Dr. Jane Achenbach, assessed traumatic brain injury with cognitive deficits and headaches. Dr. Achenbach evidently noted at that time that the employee could not do his work as a wastewater plant operator because he was unable to recall job details.
About two months later, the employee completed a 3-week truck-driving course with Roehl Transport. He received his driver’s certificate but was terminated by Roehl in October 2007 due to poor driving habits. Around this same time, the employee filed a claim petition for workers’ compensation benefits, seeking payment for periods of wage loss and medical benefits due to his 2005 head injury.
On November 29, 2007, in a letter addressed “To Whom It May Concern,” the employee’s then treating psychiatrist, Dr. Lon Augdahl, Park Nicollet Clinic, reported that the employee had been under his psychiatric care since November 2006. He stated that
[The employee] is currently struggling with a depressive episode and is unable to engage in gainful employment. He attempted to find work but has trouble with decreased energy, suicidal thinking, crying episodes, hopelessness, anhedonia and ruminative, negative thinking. These symptoms have limited his ability to find employment and sustain a typical schedule of employment. I have encouraged him to attempt to find work but his depressive symptoms are limiting his capabilities. He is currently prescribed a medication regimen which has provided benefit but thus far improvement is below what would be expected for most employment positions.
Dr. Montgomery had referred the employee to the Brain Injury Clinic at Sister Kenny Institute for rehabilitation. That treatment apparently was denied by the insurer but eventually covered by Medical Assistance. In January 2008, the employee began working with an occupational therapist to assist him with his memory and management of activities, and he began seeing Dr. David Lund for psychological counseling. Also around this time, the employee began working in a maintenance position at Walmart.
In a letter addressed to the employee’s attorney on March 24, 2008, Dr. Lund diagnosed the employee with an organic brain syndrome, major depression, and panic disorder. He opined that, based on the objective neuropsychological deficits shown on testing and the employee’s cognitive/emotional symptoms almost three years post-injury, the employee had sustained a 50% whole body impairment as a result of his May 13, 2005, injury.
On April 13, 2008, the employee was hospitalized at Hutchinson Area Healthcare on a 72-hour hold for psychiatric problems. He presented to the hospital with increased depression and suicidal thoughts, and he described problems coping with work stress, dealing with social anxiety, and being around people. Upon discharge two days later, the employee was advised to continue his medication regimen and follow-up with Dr. Lund and Dr. Augdahl.
The employee amended his claim petition to include a claim for permanent partial disability, and the matter was heard by Compensation Judge Danny P. Kelly on July 2, 2008. In a findings and order issued on October 27, 2008, the compensation judge determined that the employee had sustained a traumatic brain injury and psychiatric condition causally related to his May 13, 2005, personal injury. He awarded the claimed wage loss benefits, benefits for a 50% permanent partial disability, and the claimed medical benefits. The judge awarded also statutory attorney fees of $13,000. Neither party appealed from the judge’s findings and order.
The employee continued working for Walmart during 2008, and, at some point, he changed his work site from Monticello to Alexandria. Around this same time, the employee also transferred his psychiatric care from Dr. Augdahl to Dr. Timothy Rasmussen, who provided treatment in Alexandria.
At an initial psychiatric assessment on September 5, 2008, the employee reported to Dr. Rasmussen that he is affected by mood swings ranging from mild depression to near hopelessness. The employee described difficulties with concentration and diminished energy, drive, and motivation. He stated that he had a tendency to isolate himself and to stay away from crowds, and he reported experiencing nightmares, flashbacks, and an exaggerated startle response. Dr. Rasmussen diagnosed major depression, recurrent, severe, and possible post-traumatic stress disorder.
In a letter to the employee’s attorney on May 14, 2009, Dr. Lund stated that his clinical diagnosis for the employee had not changed since his letter of March 24, 2008. He explained, however, that, in his opinion, the employee’s condition had deteriorated substantially due in part to some interpersonal difficulties with coworkers and supervisors at Walmart. These events, Dr. Lund noted, had greatly increased the employee’s depression and feelings of hopelessness. Dr. Lund recommended that the employee be taken out of work because his depression rendered him incapable of performing his duties. He further explained that the employee’s mental health was quite fragile and that continuing his job with Walmart placed the employee at greater risk for self-harm.
A week later, on May 21, 2009, the employee was admitted to Lake Region Healthcare in Fergus Falls following what was described as overwhelming depression and escalation of suicidal ideas. There he came under the care of Dr. Jerilyn Mitchell, who diagnosed major depressive disorder recurrent, severe, without psychotic features; posttraumatic stress disorder; and mood disorder due to traumatic brain injury. The employee was discharged from the hospital on June 1, 2009, but did not return to his job at Walmart. The employer and insurer voluntarily paid total disability benefits to the employee from May 23, 2009, through December 4, 2009.
The employee was seen for a psychiatric evaluation by Dr. Thomas Gratzer at the request of the employer and insurer on October 7, 2009. As part of the evaluation, an MMPI-2-RF was administered by Dr. Marvin Logel, Ph.D. Under Axis I, referring to the employee’s mental health disease, Dr. Gratzer diagnosed: 1) major depression, recurrent, moderate to severe, in partial remission, 2) generalized anxiety disorder, and 3) history of alcohol abuse/dependence. Under Axis II, the doctor diagnosed dependent personality disorder. Dr. Gratzer questioned whether the employee’s cognitive difficulties were truly related to a traumatic brain injury as opposed to a major depression. He believed the etiology of the employee’s cognitive complaints had important treatment ramifications, and he recommended that the employee undergo repeat neuropsychological testing. Noting that major depression is highly treatable and that major depression that is unresponsive to medication is rare, Dr. Gratzer stated that he would defer any further opinions regarding the employee’s diagnosis or prognosis pending further neuropsychological evaluation.
In a letter to the employee’s attorney on December 4, 2009, Dr. Rasmussen agreed that updated neuropsychological testing might confirm the presence of persistent organic problems, but he did not believe that his treatment of the employee’s depression would change. In his opinion, the treatment of ordinary major depression and depression secondary to a brain injury would be the same, although the response might, at times, be different. At that time, Dr. Rasmussen did not believe the employee was capable of maintaining gainful employment.
In March 2010, the employee filed a claim petition for permanent total disability benefits due to his head injury of May 13, 2005. In June 2010, due to financial circumstances, the employee asked Dr. Rasmussen to give him a release to return to work. The doctor agreed that the employee could work up to 20 or 24 hours a week but no more than four hours per day. The employee then reapplied for his position at Walmart, but he was not rehired.
Three months later, the employee was offered a job as a janitor at the Cornerstone Baptist Church, the church he and his family attended in Alexandria. His duties included setting up the Sunday school rooms and cleaning the church in anticipation of Sunday services. The normal cleaning routine took about four hours per week. In addition, the employee set up for certain events at the church. The employee had no fixed schedule and was allowed to work without supervision. He was paid $12.00 per hour and, between September and November 2010, he earned approximately $100 per week, with no fringe benefits.
The employer and insurer sought clarification of the employee’s capacity to work and assigned the file to QRC Dina Babb, who met with the employee and his wife and wrote to Dr. Rasmussen. In a letter to Ms. Babb on October 11, 2010, Dr. Rasmussen replied that
[the employee] has been severely depressed recently. At one time in recent months I said that he could work some limited hours if he absolutely had to, but I don’t believe he could do more than a few hours per week in a very low stress environment due to his depression which has intensified in the past several months. I do not believe he can work anymore than that and certainly not in any kind of an environment where there would be even the slightest bit of stress.
In a meeting with Ms. Babb the following day, Dr. Rasmussen essentially repeated these restrictions.
In deposition testimony taken on November 23, 2010, Dr. Rasmussen reiterated his diagnosis of major depression, recurrent. He had just seen the employee the day before and described the employee’s depressive symptoms as having “severe intensity.” In addition, based on the employee’s continuing complaints of nightmares, flashbacks, and startled responses, as well as the fact that he became acutely agitated by these events, Dr. Rasmussen diagnosed post traumatic stress disorder. He did not believe that the employee was capable of expanding either his hours of work or his work responsibilities at that time. And, based on the employee’s clinical status, he did not believe that it would be clinically advisable for the employee to seek other employment. Dr. Rasmussen explained that, “with the intensity of depression and anxiety symptoms any other kind of work that he would do would be not only very difficult for him to complete but would add to his stress.” He approved of the employee’s limited job working 10-15 hours per week at the church.
The matter came on for hearing before Judge Danny Kelly on December 1, 2010. The sole issue presented to the judge was whether the employee was entitled to permanent total disability benefits continuing from May 22, 2009. At the hearing, the parties stipulated that the employee had achieved maximum medical improvement [MMI] on July 8, 2008; that his last date of work for Walmart was May 22, 2009; and that, if the employee is awarded permanent total disability benefits, the employer and insurer would be entitled to a credit for benefits paid from May 23, 2009, through December 4, 2009. Evidence presented at the hearing included the testimony of the employee and QRC Babb, the deposition testimony of Dr. Rasmussen, portions of the employee’s medical records, and the reports from Dr. Gratzer and Dr. Logel.
The employee testified that, essentially, he had not looked for work since leaving Walmart in 2009, and he believed that his depression had worsened in the last two years. He stated that being around people is stressful for him and that, when he is stressed, he becomes more depressed, agitated, and angry. The employee further testified that he did not think he was capable of working more than he was working in his job at the church. QRC Babb testified that, given Dr. Rasmussen’s restrictions, particularly the flexibility required for the employee’s work environment, the employee’s current job at the church represented his earning capacity. She did not believe that providing additional rehabilitation services would be appropriate.
In a findings and order issued January 19, 2011, the compensation judge determined that the employee had become permanently and totally disabled on May 22, 2009, and that the May 13, 2005, injury was a substantial contributing cause of that disability. He awarded benefits, allowed the employer and insurer’s requested credit, and ordered withholding and payment of attorney fees pursuant to the 25/20 formula found in Minn. Stat. § 176.081. The employer and insurer appeal.
STANDARD OF REVIEW
On appeal, the Workers’ Compensation Court of Appeals must determine whether “the findings of fact and order [are] clearly erroneous and unsupported by substantial evidence in view of the entire record as submitted.” Minn. Stat. § 176.421, subd. 1 (2010). Substantial evidence supports the findings if, in the context of the entire record, “they are supported by evidence that a reasonable mind might accept as adequate.” Hengemuhle v. Long Prairie Jaycees, 358 N.W.2d 54, 59, 37 W.C.D. 235, 239 (Minn. 1984). Where evidence conflicts or more than one inference may reasonably be drawn from the evidence, the findings are to be affirmed. Id. at 60, 37 W.C.D. at 240. Similarly, findings of fact should not be disturbed, even though the reviewing court might disagree with them, “unless they are clearly erroneous in the sense that they are manifestly contrary to the weight of evidence or not reasonably supported by the evidence as a whole.” Northern States Power Co. v. Lyon Food Prods., Inc., 304 Minn. 196, 201, 229 N.W.2d 521, 524 (1975).
Permanent Total Disability
An employee is totally disabled “if his physical condition, in combination with his age, training, and experience, and the type of work available in his community, causes him to be unable to secure anything more than sporadic employment resulting in insubstantial income.” Schulte v. C.H. Peterson Constr. Co., 278 Minn. 79, 83, 153 N.W.2d 130, 133-34, 24 W.C.D. 290, 295 (1967). Total disability is permanent if it is likely to exist “for an indefinite period.” Cavanaugh v. Frederick Willys, Inc., 361 N.W.2d 49, 50, 37 W.C.D. 383, 384 (Minn. 1985). The employer and insurer argue that the employee is not unemployable or unemployed. Rather, he has a release from his treating physician and has found employment, which he has held successfully for over three months. Therefore, they argue, the judge’s finding of permanent total disability is unsupported by substantial evidence, and the employee is more appropriately entitled to temporary partial disability benefits. After review of the entire record, we conclude that the compensation judge’s finding of permanent total disability should be affirmed.
Whether an employee has met the burden of proving permanent total disability is ultimately a question of fact for the compensation judge. See Atkinson v. Goodhue County Co-op Elec. Ass’n, 55 W.C.D. 150, 160 (W.C.C.A. 1996), citing McClish v. Pan-O-Gold Baking Co., 336 N.W.2d 538, 541, 36 W.C.D. 133, 138 (Minn. 1983). Although no medical doctor or vocational expert expressly opined that the employee is permanently and totally disabled, there remains substantial evidence to support the judge’s conclusion that the employee is vocationally incapable of “anything more than sporadic employment resulting in an insubstantial income.” QRC Babb testified that the employee’s earnings at the church, currently about $100 per week, represent the employee’s earning capacity. Given the restrictions recommended by Dr. Rasmussen, she saw no present benefit in continuing rehabilitation services. Likewise, Dr. Rasmussen testified that the employee’s depressive symptoms were of “severe intensity” and that seeking further employment at this point would be inadvisable. And Dr. Rasmussen also believed that the employee’s restrictions were permanent.
In his earlier findings and order issued October 27, 2008, Judge Kelly determined that the employee had sustained a traumatic brain injury and psychiatric condition as a result of his work-related head injury on May 13, 2005. He found also that the employee had sustained a 50% whole body impairment due to the injury. In the current proceeding, both Dr. Lund and Dr. Rasmussen recommended that the employee be taken off work in May 2009. The employer and insurer voluntarily paid total disability benefits to the employee through December 4, 2009. Thereafter, the employee remained off work until September 9, 2010, when he obtained the job at Cornerstone Baptist Church. At the employee’s request, in June 2010, Dr. Rasmussen released him to part-time work at a low stress job. Whether an employee’s earnings represent an “insubstantial” income is a question of fact for the compensation judge. Sigurdson v. Joyce Int’l, slip op. (W.C.C.A. Sept. 22, 2005). Here, the judge found the employee’s job at the church, working a loosely scheduled, highly flexible, 4 to 15 hours per week, to be sporadic employment resulting in an insubstantial income. Other than simply pointing out that the employee is currently employed, the employer and insurer offer no argument contrary to the judge’s conclusion that the employee’s earnings are insubstantial. As the supreme court stated long ago, “[s]poradic competence, occasional, intermittent, and much limited capacity to earn something somehow, does not reduce what is otherwise total to a partial disability.” Green v. Schmahl, 202 Minn. 254, 256, 278 N.W. 157, 158, 10 W.C.D. 209, 211 (1938).
While there is a possibility that the employee’s condition will improve, his current situation is likely to exist for an indefinite period of time. In view of the evidence of record, including the employee’s testimony, the medical and vocational evidence, and the employee’s earning records, it was not unreasonable for the judge to conclude that the employee has established that he is permanently and totally disabled. We therefore affirm. See Hengemuhle, 358 N.W.2d at 59, 37 W.C.D. at 239.
In his findings and order issued October 27, 2008, the judge ordered payment of attorney fees pursuant to the 25/20 formula found in Minn. Stat. § 176.081, subject to the maximum permissible fee of $13,000. The judge issued the same order for attorney fees in his findings and order currently on appeal. However, the statute provides that all fees for legal services related to the same injury are cumulative and may not exceed $13,000. Minn. Stat. § 176.081, subd. 1(a)(3). As such, an additional contingent fee, under the statute, is not permissible here. We therefore vacate the judge’s order on attorney fees and remand the matter to the judge to determine a reasonable fee applying the factors set forth in Irwin v. Surdyk’s Liquor, 599 N.W.2d 132, 59 W.C.D. 319 (Minn. 1999).
 Portions of the background information have been taken from an unappealed findings and order issued in this matter on October 28, 2008.
 See finding 23, findings and order issued October 27, 2008.
 Dr. Lund rated the employee’s permanent partial disability under Minn. R. 5223.0360, subp. 7.C.(1), and Minn. R. 5223.0360, subp. 7.D.(3).
 Reduced to 46% after application of the formula contained in Minn. R. 5223.0300, subp. 3.E.