RICHARD O. WALKER SR., Deceased Employee, by LUCILLE WALKER, v. BOISE CASCADE CORP., SELF-INSURED, Employer/Appellant, and BOISE CASCADE CORP. and EMPLOYERS INS. OF WAUSAU, Employer-Insurer, and MEDICARE, Intervenor.

 

WORKERS= COMPENSATION COURT OF APPEALS

FEBRUARY 10, 2003

 

HEADNOTES

 

PERMANENT PARTIAL DISABILITY.  Permanent partial disability vests and is payable to the estate of a deceased employee where permanent partial disability is ascertainable before the date of death, the employee lives for more than 30 days from the date of injury and but for a denial of primary liability, later withdrawn, the employee was entitled to payment of permanent partial disability.

 

Affirmed.

 

Determined by Stofferahn, J., Wilson, J., and Pederson, J.

Compensation Judge: Donald C. Erickson

 

OPINION

 

DAVID A. STOFFERAHN, Judge

 

The self-insured employer appeals from the compensation judge=s award of permanent partial disability benefits to the estate of the deceased employee.  We affirm.

 

BACKGROUND

 

The facts in this matter are not in dispute.  The employee, Richard Walker, began working for Boise Cascade in 1939.  He left for military service in 1941 and then returned in 1946.  The employee worked at Boise Cascade thereafter until his retirement in 1982. 

 

On December 30, 1999, the employee was diagnosed with malignant pleural mesothelioma.  On April 3, 2000, the employee filed a claim petition in which he alleged that his condition was caused by asbestos exposure during his employment at Boise Cascade.  The petition claimed an injury date of December 30, 1999, a date when Boise Cascade was self-insured for workers= compensation liability.  The employee sought payment of medical expenses and a minimum of 50 percent permanent partial disability of the whole body.  The answer filed by Boise Cascade denied primary liability. 

 

The employee had an independent medical examination with Dr. Ronald Vessey on June 29, 2000.  In his report of July 24, 2000, Dr. Vessey concluded the employee=s mesothelioma was due to his asbestos exposure at Boise Cascade but opined that the relevant period of exposure was when Boise Cascade was not self-insured.^[1]  Dr. Vessey also stated in his report that the employee had a 50 percent permanent partial disability of the body.  Boise Cascade continued its denial of the employee=s claim.

 

On September 30, 2000, the employee died.  A claim petition was filed thereafter, alleging that the employee=s death was due to his occupational exposure to asbestos between 1946 and 1982.  The claim petition sought dependents benefits and 75 percent permanent partial disability to the whole body.  A subsequent amended claim added Wausau Insurance Company as a party. 

 

Prior to hearing, the parties reached a partial settlement of the issues in the case.  Boise Cascade, self-insured, accepted primary liability for the employee=s malignant pleural mesothelioma.  The parties reached agreement for a lump sum compromise payment of dependents benefits and agreed that the employee had sustained a 75 percent permanent partial disability as a result of his work injury.  Finally, the parties stipulated that there continued to be a dispute as to whether the employee=s permanent partial disability benefits were payable after his death. 

 

The parties submitted this remaining issue to the compensation judge by written memorandum.  In his Findings and Order, served and filed August 19, 2000, the compensation judge found that the employee=s right to receive permanent partial disability benefits had vested before his death and that permanent partial disability benefits were payable to the employee=s estate.  The employer appeals. 

 

DECISION

 

The sole issue on appeal is whether the compensation judge was correct in determining that the employee=s entitlement to permanent partial disability benefits had vested before his death and that those benefits were payable to the employee=s estate.  The employer argues that because primary liability was in dispute at the time of the employee=s death, the claim for permanent partial disability benefits could not have vested and was not payable. 

 

The leading opinion on this issue is Owens v. Water Gremlin Co., 605 N.W.2d 733, 60 W.C.D. 36 (Minn. 2000).  In that case, the employee sustained a work related crush injury on February 27, 1995, which resulted in a 99.93 percent permanent partial disability.  The employer and insurer admitted primary liability and commenced payment of concurrent temporary total and permanent partial disability benefits.  The employee died on May 28, 1996, and the employer and insurer sought to discontinue permanent partial disability benefits.  The employee=s claim for continuing permanent partial disability benefits was denied by the compensation judge but that decision was reversed by the Workers= Compensation Court of Appeals.

 

The supreme court in reviewing Owens first determined that it was the law in effect on the date of the employee=s death which was applicable in determining whether benefits were payable, citing Minogue v. City of St. Paul, 320 N.W.2d 90, 34 W.C.D. 698 (Minn. 1982), and other cases.  The 1996 applicable law is set forth in Minn. Stat. ' 176.021, subd. 3, which provides in relevant part Athe right to receive permanent partial compensation vests in an injured employee at the time the disability can be ascertained provided that the employee lives for at least 30 days beyond the date of the injury.  Upon the death of an employee who is receiving economic recovery compensation or impairment compensation, further compensation is payable pursuant to section 176.101.@

 

The Owens court found three conditions in the statute which must be met before further compensation was payable: (1) the ascertainment of disability, (2) the determination that the employee had lived at least 30 days from the date of injury, and (3) the receipt of economic recovery compensation or impairment compensation at the time of death.  Once those conditions were met, as they were determined to be by the court in Owens, the full amount of the employee=s permanent partial disability benefits was payable to the employee=s estate.

 

In Oswald v. Boise Cascade, 61 W.C.D. 166 (W.C.C.A. 2001), this court considered the application of Owens to a case in which, although some permanent partial disability benefits had been paid to the employee before his death, there was a dispute as to the extent of disability and benefits had stopped.  The employer contended that because there was a dispute over the extent of permanent partial disability and because no benefits were being paid due to the dispute at the time of the employee=s death, no vesting had occurred and no further benefits were owed.  This court determined that, after the compensation judge found the employee had sustained permanent partial disability in excess of that voluntarily paid, the employer was responsible for the additional benefit.  This court noted AWe conclude that the only reasonable way to construe >who was receiving= is to construe it to mean >who is receiving or entitled to receive= economic recovery compensation or impairment compensation.  Clearly an employer should not be able to avoid liability for significant permanent partial disability benefits by simply placing itself in a position where benefits are not being paid at the time an employee dies.@

 

The rationale of the Oswald decision applies to the present case as well.  Clearly the employee here met the first two conditions of the Owens decision since permanent partial disability was ascertainable before his death and the employee lived for more than 30 days after his date of injury.  We agree with the compensation judge=s view of this issue as set out in Finding 15.  ABut for the employer=s denial of primary liability, which has now been withdrawn, the employee was >entitled to receive= permanent partial disability benefits at the time of his death.  Being so entitled, his rights survives his death and is payable to his estate.@

 

The decision of the compensation judge is affirmed.