JAMES R. THOMPSON, Employee/Appellant, v. J & L STEEL ERECTORS and RTW, INC., Employer-Insurer, and UNIVERSITY OF MINN. PHYSICIANS and TWIN CITIES IRON WORKERS= FRINGE FUND, Intervenors.

 

WORKERS= COMPENSATION COURT OF APPEALS

MAY 29, 2008

 

No. WC07-238

 

HEADNOTES

 

EVIDENCE - RES JUDICATA.  The compensation judge erred in concluding that the employee=s claim for benefits after a prior hearing was barred by collateral estoppel where there had been no finding in the previous litigation that the claimed injury was merely temporary and had fully resolved.

 

Reversed and remanded.

 

Determined by: Wilson, J., Johnson, C.J., and Stofferahn, J.

Compensation Judge: Kathleen Behounek

 

Attorneys: Raymond R. Peterson, McCoy, Peterson & Jorstad, Minneapolis, MN, for the Appellant.  Thomas F. Coleman, Cousineau McGuire, Minneapolis, MN, for the Respondents.

 

 

OPINION

 

DEBRA A. WILSON, Judge  

 

The employee appeals from the compensation judge=s finding that the employee is collaterally estopped from claiming benefits for a 1997 injury.  We reverse the judge=s finding and remand the matter for determination of the employee=s claims on the merits.

 

BACKGROUND

 

The employee filed an amended claim petition on May 12, 2004, seeking temporary total disability benefits as a result of work injuries he allegedly sustained on April 14, 1997, and December 4, 2003, while employed by J & L Erectors [the employer].  The employer and its workers= compensation insurer filed an answer to the claim petition denying that a work-related injury had occurred on April 14, 1997, denying notice, and disputing the extent of disability.  The employer and insurer subsequently filed another  answer to the amended claim petition, addressing only the claimed December 4, 2003, injury.

 

The claim petition proceeded to hearing on April 19, 2005, and May 26, 2005.  In findings and order filed on August 19, 2005, the compensation judge found that the employee had  sustained a work-related injury to his low back on April 14, 1997; that the preponderance of evidence failed to show that the employee had sustained a work-related injury to his low back on December 4, 2003; and that the Apreponderance of evidence fails to show that the employee=s work injury of April 14, 1997 was a substantial contributing factor in the employee=s low back condition and resulting disability, need for restrictions and need for medical treatment from and after December 8, 2003.@

 

Both parties appealed from the compensation judges decision, but the appeals were dismissed, as untimely, by order dated October 21, 2005.

 

On May 10, 2006, the employee filed a claim petition seeking temporary total disability benefits from May 26, 2005, through September 24, 2005, and temporary partial disability benefits continuing from September 25, 2005, as a result of the April 14, 1997, work injury.^[1]  In their answer filed May 17, 2006, the employer and insurer admitted a temporary aggravation injury on April 14, 1997, Afrom which the employee fully recovered without any residual symptoms, permanency, restrictions or diminution in earning capacity.@  The employer and insurer also asserted that the employee=s claims were barred by res judicata and by collateral estoppel.

 

On May 25, 2006, the employer and insurer filed a motion for summary judgment based on res judicata and collateral estoppel.  By order of November 9, 2006, that motion was denied.

 

When the claim petition proceeded to hearing on June 20, 2007, counsel for the employer and insurer renewed the motion for summary judgment based on res judicata and collateral estoppel.  The compensation judge indicated that she would take the motion under advisement and include her decision in her findings and order.

 

The findings and order were filed on September 7, 2007.  The compensation judge found that the employee was collaterally estopped from claiming benefits due to the April 14, 1997, injury, based on the previous findings and order.  The employee appeals.

 

STANDARD OF REVIEW

 

A[A] decision which rests upon the application of a statute or rule to essentially undisputed facts generally involves a question of law which [the Workers= Compensation Court of Appeals] may consider de novo.@  Krovchuk v. Koch Oil Refinery, 48 W.C.D. 607, 608 (W.C.C.A. 1993).

 

DECISION

 

The employee contends that the claims before the compensation judge in the most recent proceeding were for benefits after May 26, 2005, benefits that were not addressed at the previous hearing; that the judge did not find, in the previous findings, that the 1997 work injury was merely temporary or that the employee had no further entitlement to benefits; and that, therefore, the doctrines of res judicata and collateral estoppel do not apply.  We agree.

 

Principles of res judicata are applicable in workers= compensation proceedings.  See e.g., Alexander v. Kenneth R. LaLonde Enters., 288 N.W.2d 18, 31 W.C.D. 407 (Minn. 1980).  However, res judicata applies in workers= compensation cases only with respect to issues actually litigated and decided.  See, e.g., Fischer v. Saga Corp., 498 N.W.2d 449, 450, 48 W.C.D. 368, 369 (Minn. 1993) citing 3 Larson, The Law of Workmen=s Compensation '79.72 (f) (1992) (Ares judicata does not apply if the issue at stake was not specifically decided in the prior proceeding@).  The Minnesota Supreme Court has held that the principles of collateral estoppel are appropriately applied in the following circumstances: (1) the issue is identical to one in a prior adjudication; (2) there was a final judgment on the merits; (3) the estopped party was a party or in privity with a party to the prior adjudication; and (4) the estopped party was given a full and fair opportunity to be heard on the adjudicated issue.  Nelson v. American Family Ins. Group, 651 N.W.2d 499, 511 (Minn. 2002); Willems v. Commissioner of Pub. Safety, 333 N.W. 2d 619, 621 (Minn. 1983).

 

The employer and insurer argue that the temporary injury defense was raised at the first hearing and that Athere is no other conclusion that can be reached from the first findings and order other than [that the 1997 injury] was a temporary injury.@  The transcript from the 2005 hearing does reflect that the employer and insurer raised Atemporary injury@ as an alternative defense to the employee=s claims regarding the 1997 work injury.  However, the compensation judge did not make a finding that the 1997 work injury was merely a temporary injury.  Rather, in her memorandum, she explained her finding that the Apreponderance of the evidence fails to show that the employee=s work injury of April 14, 1997 was a substantial contributing cause or factor in the employee=s low back condition and resulting disability@ as follows:

 

The evidence does support the employer and American Compensation=s contention that there is no medical opinion that the April 14, 1997 work injury is a substantial contributing factor in the employee=s low back condition subsequent to December 2003.  Accordingly, benefits claimed by the employee as a result of the April 14, 1997 work injury are denied.

 

It therefore appears that the employee=s claim for temporary total disability benefits as a result of the 1997 work injury, up to the date of the first hearing, was denied for lack of proof.  That does not equate to a finding that the 1997 work injury was temporary or mean that the employee was foreclosed from claiming benefits thereafter.

 

There being no final judgement on the issue of whether the 1997 injury was temporary, we vacate the judge=s finding that the employee is estopped from asserting a claim for benefits related to that injury.  We remand the case to the judge for findings as to whether the 1997 injury was temporary and whether the employee is entitled to temporary partial and temporary total disability benefits, as claimed.^[2]