GALEN T. BLOCK, Employee/Petitioner v. EXTERIOR REMODELING, INC., and STATE AUTO/MERIDIAN CITIZENS SEC. MUT. INS. CO., Employer-Insurer/Respondents.

The employee petitions this court to vacate an Award on Stipulation, served and filed on May 11, 1992, on grounds that there has been a substantial change in his condition since the issuance of the award and that the award was entered into based upon a mutual mistake of fact. Having found a sufficient basis to vacate the award on stipulation, we grant the petition.

The employee, Galen T. Block, was injured while working for the employer on a construction job. The employee experienced the onset of low back pain when he lifted a box of siding weighing 150 pounds. The date of injury is variously described as August 16, 1988, and September 8, 1988.

On October 6, 1988, the employee underwent a left L5-S1 hemilaminectomy. The employee was 29 years old at the time of this surgery. This procedure left the employee with lingering low back discomfort, but no work restrictions after three months. The employee was rated at 9% permanent partial disability (PPD) under Minn. R. 5223.0070, subp. 1 (1984) by David R. Johnson, M.D. The employee returned to work at the same job. A partial settlement was entered regarding the 9% PPD, temporary total disability (TTD), and temporary partial disability (TPD) benefits. The employee’s treating physician, Burton M. Onofrio, M.D., recommended that the employee work in a less strenuous job to avoid recurring back problems.^[1]

On July 3, 1991, the employee underwent a second laminectomy (described by Dr. Onofrio as “absolutely hideously difficult”) to address recurrent lumbar and left leg pain. The employee was 32 years old at the time of this surgery. Following this surgery, Dr. Onofrio kept the employee off of work for three months, imposed permanent work restrictions of 20 pounds lifting and no repetitive bending, stooping, or twisting. Dr. Onofrio rated the employee at 13% PPD from the first operation and 5% PPD from the second surgery at the same level. The employee changed careers to work in automobile sales.^[2]

In May 1992, the employee entered into a stipulation with the employer and insurer agreeing that TTD, TPD, and PPD benefits based on the 18% PPD rating (less the prior 9% PPD settlement) would be paid in the form of a lump sum payment of $40,000.00. Attorneys’ fees in the amount of $6,500.00 were taken out of the lump sum payment. The settlement was full, final, and complete, except for future medical treatment. The settlement formed the basis for the Award on Stipulation served and filed on May 11, 1992.^[3]

The employee’s back condition did not restrict his activities. The employee built a new house in 2005 and 2006. The employee performed much of the construction work himself, including lifting, siding, and roofing. The employee experienced no symptoms of back pain or radicular pain or numbness. ^[4]

The employee did not treat for his back condition from 1992 until May 2009. In late 2008, at age 50, the employee began having left leg symptoms in his thigh and buttocks. The employee also began experiencing left foot drop. In 2009, after two incidents, one where the employee twisted his back at work and one where he stumbled, the employee developed more low back and left leg problems. The employee rated his pain symptoms as 5 out of 10. MRI imaging showed a disc herniation at L5-S1 and the employee underwent steroid injections.

On November 6, 2009, the employee underwent surgical decompression at L4-L5 and L5-S1. The employee’s symptoms did not improve. On March 9, 2010, the employee underwent decompressions and fusion at L3 through S-1. The employee was able to return to work after two months. The employee continues to experience some pain, particularly when walking.^[5]

On May 10, 2012, R. Wynn Kearney, Jr., M.D., conducted an independent medical examination (IME) of the employee at the request of the employee’s counsel. Dr. Kearney opined that the employee’s condition and all four of his lumbar surgeries were solely the consequence of the August 16, 1988, work injury. Dr. Kearney opined that the employee could lift 40 to 50 pounds at waist level intermittently but avoid lifting from floor level.

On March 19, 2012, H. William Park, M.D., conducted an IME of the employee at the request of the employer and insurer. Dr. Park opined that the employee’s need for fusion surgery was unrelated to the August 16, 1988, work injury. Dr. Park also opined that the employee was able to work in automobile sales without restrictions.

On January 24, 2013, Robert A. Wengler, M.D., conducted an IME of the employee at the request of the employer and insurer. Dr. Wengler rated the employee as having 35% impairment of the body as a whole under Minn. R. 5223.0390, subps. 4.E.(1)(3) and (4), and 5.B. Dr. Wengler attributed 15% PPD to the original 1988 injury and 20% PPD to the May 2009 aggravation. Dr. Wengler opined that the May 2009 incidents were a material aggravation of a pre-existing condition.

On June 18, 2013, Paul T. Wicklund, M.D., conducted an IME of the employee at the request of Rochester Motor Company, Inc., and Federated Insurance. Dr. Wicklund attributed all of the employee’s low back condition to the August 16, 1988, work injury. Dr. Wicklund found no causal connection between the employee’s condition and any incident in 2009.

The employer and insurer sought contribution from Rochester Motors (the employee’s current employer). On February 19, 2014, the employer settled with Rochester Motors on a full, final, and complete basis for a payment of $1,000.00.

From 2008 onward, the employee described losing time from work due to the effects of his August 16, 1988, work injury and the required medical care to his low back and left leg. The employee described a significant decrease in work hours and income that he ascribed to the effects of his work injury. There were significant periods when the employee was unable to work at all. The employee also described significant restrictions in both his work and personal life.^[6]

The petitioner seeks to vacate the May 11, 1992, Award on Stipulation, maintaining that there was a material mistake of fact at that time. In the alternative, the employee asserts that he has experienced a substantial change in his medical condition through the fusion surgery and extension of surgical intervention to different levels resulting in an impairment in his condition that could not have been anticipated at the time of the settlement.

Minn. Stat. § 176.461 permits “the Workers’ Compensation Court of Appeals, for cause, at any time after an award, . . . to set the award aside and grant a new hearing and refer the matter for a determination” by a compensation judge.^[7] As the award in this proceeding was issued prior to the effective date of the current statutory language, the preexisting standards for vacation of awards are applicable. At that time, Minnesota case law defined “for cause” as fraud, mistake, newly discovered evidence, or a substantial change in the employee’s condition. Ryan v. Potlatch Corp., ___N.W.2d ___ (Minn. July 13, 2016)(citing Stewart v. Rahr Malting Co., 435 N.W.2d 538, 539 (Minn. 1989); Krebsbach v. Lake Lillian Co-op Creamery Ass’n, 350 N.W.2d 349, 353 (Minn. 1984); Turner v. Fed. Reserve Bank of Minneapolis, 298 Minn. 161, 167, 213 N.W.2d 414, 417-18 (1973)).

The employee contends that a mutual mistake of fact existed when the stipulation was entered into. The employee believed himself to have been cured of his low back problem at the time of settlement. The employee maintains that his was a mistake that was relied on at the time and should support vacation of the award on stipulation. The employer disputes this contention, citing medical records where the employee described residual deficits after surgery in the form of left leg numbness and tingling.

Generally, a case involving mutual mistake of fact exhibits some extraneous evidence that was misinterpreted. See Monson v. White Bear Mitsubishi, 663 N.W.2d 534; 63 W.C.D. 337 (Minn. 2003)(contemporaneous evidence of a failed fusion where the parties to the settlement believed that the fusion surgery was successful constituted a mutual mistake of fact that supported vacating an award on settlement). The subjective belief of one party does not constitute a mutual mistake of fact.

    The Minnesota Supreme Court has approved vacation of awards due to mutual mistake, even when the doctrine has not strictly applied. Mattson v. Abate, 279 Minn. 287, 156 N.W.2d 738, 24 W.C.D. 464 (1968); Walker v. Midwest Foods, 293 Minn. 460, 197 N.W.2d 430, 26 W.C.D. 215 (1972); Alexander v. Kenneth R. LaLonde Enters., 288 N.W.2d 18, 32 W.C.D. 312 (Minn. 1980). The test to be met is whether the primary objective of assuring compensation proportionate to an employee’s disability would otherwise be thwarted. Napper v. Boise Cascade Corp., 348 N.W.2d 81; 36 W.C.D:731 (Minn. 1984). In this matter, there is no indication that proportionate compensation is not available to the employee. There is no basis for vacating the award on the ground of mutual mistake of fact.

When reviewing a petition to vacate an award that is filed on the basis of a change in condition, this court considers a number of factors, including those set forth in Fodness v. Standard Café, 41 W.C.D. 1054 (W.C.C.A. 1989). The Fodness factors are:

1.  a change in diagnosis;
2.  a change in the employee’s ability to work;
3.  additional permanent partial disability;
4.  the necessity for more costly and extensive medical care than previously anticipated;
5.  a causal relationship between the injury covered by the settlement and the employee’s current condition; and
6.  the contemplation of the parties at the time of settlement.^[8]

Applying the Fodness factors to the analysis of the case, the employee’s condition as it was at the time of the award is compared with the employee’s condition at the time that vacation of the settlement is sought. See Davis v. Scott Moeller Co., 524 N.W.2d 464, 466-67, 51 W.C.D. 472, 475 (Minn. 1994).

The employer acknowledged that the change in diagnosis factor has been met as the employee’s condition has expanded from one level to three and includes a fusion. Expanded levels and different conditions affecting the low back have been held to meet this factor.^[9] This factor is met for vacating the award and is not in dispute between the parties.

The employer contended that the restrictions described by Dr. Kearney as of May 2012 were less restrictive than those at the time of the settlement, therefore this factor does not favor vacating the order for settlement. The employee contended that the effects of his low back condition caused a reduction in hours worked and a resultant reduction in income.

Where the change is minor, this factor does not support vacating the award. Benoit v. Max Gray Constr., No. WC09-4984 (W.C.C.A. Mar. 9, 2010). In this instance, the employee has consistently worked full-time from the time of the settlement until his recent surgeries. Since those surgeries, the employee has seen a consistent reduction of hours and income.^[10] The change in the employee’s ability to work supports vacating the award.

Generally, a minor increase in an employee’s permanent partial disability rating does not demonstrate a substantial change in the employee’s condition. Van Vickle v. Action Moving Servs., slip op. (W.C.C.A. Jan. 2, 1997). An additional 5% was not found to be a substantial increase in permanency. Benoit, No. WC09-4984 (W.C.C.A. March 9, 2010). An additional 15% was a substantial increase that meets this factor. Betcher v. Modern Tool, Inc., No. WC12-5387 (W.C.C.A. July 11, 2012). In this matter, the employer acknowledged that the employee has been given a higher rating. The employer does not contest that this factor is met. This factor weighs in favor of vacating the award.

The employee’s need for additional treatment is given less weight in assessing the Fodness factors where medical expenses are not closed out by the award. Burke v. F & M Asphalt, 54 W.C.D. 363 (W.C.C.A. 1996). Changes in the extent of treatment since the stipulation have been considered “useful evidence bearing on whether there has been a substantial change in the employee’s medical condition.” Betcher v. Modern Tool, Inc., No. WC12-5387 (W.C.C.A. July 11, 2012)(citing Vellieux v. Catholic Charities, No. WC06-223 (W.C.C.A. Mar. 8, 2007)); Dehn v. Star Tribune/Cowles Media Co., No. WC14-5591 (W.C.C.A. June 17, 2014). The employer argues that additional surgery, standing alone, does not justify vacation of an award, citing Burke and Miedema v. Brown Group Inc., slip op. (W.C.C.A. Apr. 22, 1996). The number and scope of the employee’s post-award surgeries indicate that the employee has experienced a change in medical condition supporting vacation of the award.

The employer maintained that there is no causal relationship between the employee’s current condition and the August 16, 1998, work injury. The employer requested that this matter be stayed for an evidentiary hearing at the Office of Administrative Hearings (OAH) for a determination of this issue. The employee noted that the employer had sought contribution from Rochester Motors for the benefits paid arising out of the 2009 worsening of the employee’s condition, but settled on a full, final, and complete basis for a nominal amount. Further, the employee noted that both Drs. Wicklund and Kearney opined that the employee’s current condition was due solely to the August 16, 1988, work injury.

On a successful petition to vacate due to change in medical condition, a prima facie case must be made of a worsened condition caused by the work injury. Davis v. Scott Moeller Co., 524 N.W.2d 464; 51 W.C.D. 472 (Minn. 1994)(citing Bennett v. Hoiseth Motor Sales, 302 Minn. 534, 535, 224 N.W.2d 148, 149 (1974)). The employee’s evidence meets this standard. While the employer and insurer asked for referral of this matter to OAH for an evidentiary hearing on causation, that would be duplicative, as causation can be raised as an issue after vacation of the award. The employee has demonstrated a prima facie case of causation in this proceeding which meets this factor for the purpose of vacating the award.

The employer asserted that there is no evidence either way that the parties recognized that the employee’s condition could worsen. The employee indicated that he thought he had been “cured” by the July 3, 1991, surgery. As noted above, the settlement amount in 1992 was $40,000.00, less $6,500.00 in attorneys’ fees. Where a limited amount is paid as a settlement award and both parties assumed that the employee would continue working, subsequent disability supports vacation of the award. Anker v. Hinrick’s Custom Cabinets, No. WC10-5158 (W.C.C.A. Feb. 8, 2011); Dehn, No. WC14-5591 (W.C.C.A. June 17, 2014).^[11] While the employee has not experienced total disability outside of the periods of recovery from surgery, there is sufficient ongoing impairment of the employee’s ability to work and engage in other activities to demonstrate that the employee’s current condition was not in the contemplation of the parties at the time of settlement. This factor supports vacation of the award.

The petitioner has met the Fodness factors in support of vacating of the May 11, 1992, Award on Stipulation. Therefore, this court grants the employee’s petition and vacates the May 11, 1992, Award on Stipulation. However, nothing in this decision should be construed as a finding as to diagnosis, ability to work, permanent partial disability, or causation, for purposes of future litigation.