JOYCE CAGLE, Employee/Appellant, v. ST. BENEDICT’S CHURCH and CATHOLIC MUT. GRP., Employer-Insurer/Respondents.

The employee appeals the compensation judge’s findings which fail to specifically and adequately address two issues raised at the hearing.  We vacate and remand for specific findings on the issues of whether the proposed left hip surgery is reasonable and necessary, and whether the principles of res judicata or collateral estoppel prevent the employer and insurer from relitigating the issue of causation.

On February 3, 2012, Joyce Cagle, an employee of St. Benedict’s Church, the employer, was moving a couch in the parish office when she felt severe pain in her low back and hip area.  The employer and its insurer admitted liability for the injury and paid medical benefits.  On March 30, 2012, the employee underwent a right-sided L2-3 hemilaminectomy and discectomy performed by Dr. James MacNutt at St. Luke’s Hospital and in 2014, underwent right hip surgery performed by Dr. Christopher Larson, an orthopedic surgeon with Twin Cities Orthopedics (TCO).  As early as 2013, the employee had also treated for left hip pain.

In 2017, the employee retained Dr. Mark Gregerson, who examined the employee, reviewed her medical records, and took her medical history.  In his report of August 9, 2017, Dr. Gregerson noted pain and loss of range of motion in both the right and left hips during the physical examination.  While the diagnosis was right hip femoral neck impingement and labral tear secondary to the February 3, 2012, work injury, Dr. Gregerson nevertheless examined and commented on both hips.  He stated that the MRI scan of August 23, 2013, showed a probable anterior labral tear of the left hip, and in reviewing a CT scan of the bilateral hips from December 23, 2013, he observed femoral neck impingement on the right hip and similar findings on the left hip.

In June 2018, the parties settled the workers’ compensation claim.  The employer and insurer paid a lump sum to close out the employee’s benefits related to the injury, leaving open future medical expenses for the low back, right hip, and left hip.

Two months after the settlement, on August 8, 2018, the employee saw Dr. Larson complaining of ongoing left hip pain.  Dr. Larson ordered an injection to the left hip which was performed on August 17, 2018.  The employer and insurer denied payment for the treatment.  The employee filed a claim petition for payment, which went to hearing on March 13, 2020.  By Findings and Order of May 4, 2020, the compensation judge found that the August 8 and August 17, 2018, medical treatments were causally related to the work injury of February 3, 2012.  However, the compensation judge was unable to determine the reasonableness and necessity of the treatment because no corresponding billing records were provided, and he denied the claim.  There was no appeal of this decision.

The employee continued to treat with Dr. Larson and in July 2020, Dr. Larson recommended that the employee undergo left hip surgery similar to the right hip surgery that he had performed in 2014.  The employer and insurer denied that the recommended left hip surgery was reasonable, necessary, or causally related to the work injury.  On September 3, 2020, the employee filed a medical request for approval of the surgery.  The employee underwent an independent medical examination with Dr. Loren Vorlicky at the employer and insurer’s request in November 2020.  In a report dated December 16, 2020, Dr. Vorlicky opined that the employee’s condition was not caused by her work injury and that further surgical intervention was not recommended, stating that the proposed surgery would have a poor surgical result.

The matter went to hearing on May 5, 2021, before the same compensation judge.  At the hearing, the employee argued that the issue of causation had previously been litigated at the March 13, 2020, hearing and that the compensation judge had determined that the treatment in August 2018 was related to the work injury.  Because that treatment was to the left hip, the employee argued that the principles of res judicata or collateral estoppel prevented the employer and insurer from relitigating the causal relationship between the work injury and the employee’s left hip condition.

By Findings and Order of July 1, 2021, the compensation judge found that the left hip condition was not related to the 2012 work injury.  The judge made no specific finding on whether collateral estoppel barred the employer and insurer from relitigating the issue of causation and made no specific finding on whether the proposed left hip surgery was reasonable or necessary.  The employee appeals.

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(3).  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).

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), summarily aff’d (Minn. June 3, 1993).

On appeal, the employee argues that the compensation judge erred in failing to make specific findings on the issues of whether the proposed surgery was reasonable or necessary and whether the doctrine of collateral estoppel bars the employer and insurer from raising the issue of causation.  The employee argues that the causal relationship of the left hip condition to the work injury had been determined in a prior hearing and therefore could not be undone.  The employer and insurer argue that the compensation judge’s decision is supported by substantial evidence in Dr. Vorlicky’s report, and that the employee did not properly raise the issue of res judicata or collateral estoppel at the hearing or in her notice of appeal.

This court’s authority extends to reviewing findings of fact made by the compensation judge to determine whether the “findings of fact and order were clearly erroneous and unsupported by substantial evidence in view of the entire record as submitted.”  Minn. Stat. § 176.421, subd. 1(3).  “The compensation judge's decision shall include a determination of all contested issues of fact and law and an award or disallowance of compensation or other order as the pleadings, evidence, this chapter and rule require.”  Minn. Stat. § 176.371.  The question before this court on appeal is whether the compensation judge’s findings of fact are adequately supported by substantial evidence in the record as a whole.  A compensation judge must assure the findings of fact are sufficiently detailed and specific for effective review.  Northwest Publ’ns, Inc. v. Anderson, 259 N.W.2d 254, 257 (Minn. 1977); Carlson v. City of Minneapolis, 62 W.C.D. 444 (W.C.C.A. June 3, 2002).  The findings should include as many subsidiary facts as are necessary for an appellate court to determine the basis of the compensation judge’s conclusion.  Carlson, 62 W.C.D. at 451 (citing Woodrich Constr. Co. v. State of Minn., 177 N.W.2d 563 (Minn. 1970)).

Here, the judge made no specific findings on two salient issues raised by the parties: whether the employer and insurer were estopped from raising the issue of the causal connection between the recommended surgery and the employee’s work injury, and whether the recommended surgery was reasonable and necessary.  We will address each issue separately.

In considering the issue of application of res judicata^[1] or collateral estoppel,^[2] we first address the employer and insurer’s argument that this issue was not raised at the hearing and cannot be raised on appeal.  We note that the employee first raised the issue by filing a memorandum of law before the hearing arguing that the issue of causation had previously been litigated and could not be relitigated.  The employer and insurer responded to that argument in their pre-trial brief.  At the start of the hearing, the parties mentioned that the issue of collateral estoppel or res judicata was addressed in their pre-trial briefs.  In her closing arguments, the employee again argued that res judicata prevented litigation of the issue of whether her left hip tear was related to the work injury.  This issue was raised at the hearing and this court has jurisdiction to consider it on appeal.^[3]

The compensation judge’s Finding 8 stated that the recommended surgery for the employee’s left hip is not causally related to the 2012 work injury.  This finding is inconsistent with the judge’s previous unappealed finding that the August 2018 treatment to the left hip was causally related to that injury.  Given the inconsistencies, this court is reluctant to reconcile these findings by drawing inferences from the record to determine whether there is evidence to support the compensation judge’s finding addressing the causal connection between the employee’s left hip surgery and her work injury.  Without clear findings from the compensation judge, this court cannot resolve the issue of whether the judge’s previous finding on causation is binding on the parties in the current case.

Likewise, the issue of whether the surgery was reasonable and necessary requires findings of fact to support the judge’s order denying it.  The findings must be sufficiently detailed and specific for this court’s review.  While the compensation judge’s memorandum includes some discussion of the evidence regarding the surgery, a conclusion expressed in a memorandum is not a finding of fact.  See Bennetts v. United Hosp., No. WC13-5618 (W.C.C.A. Feb. 18, 2014).  The judge’s decision should not require the reviewing court to determine the facts supporting the decision or to choose between conflicting testimony and inferences.  Mendez-Merino v. Farmstead Foods, slip op. at 7-8 n.7 (W.C.C.A. Aug. 7, 2001) (citing Bryan v. Cmty. State Bank of Bloomington, 285 Minn. 266, 172 N.W.2d 771 (1969)).  In making findings of fact, the compensation judge must weigh the evidence, determine the credibility of witnesses, choose among contested facts, and draw appropriate inferences.  Carlson, 62 W.C.D. at 451.  The compensation judge’s determination in the memorandum that the proposed surgery was not reasonable and necessary lacks essential findings of fact to support the ultimate legal conclusion reached.

We therefore vacate Finding 8 and Order 1 of the compensation judge’s July 1, 2021, Findings and Order, and remand this matter for specific findings related to the issues of whether the employer and insurer were estopped from arguing that the employee’s left hip injury was not causally related to the employee’s 2012 work injury and whether the recommended surgery was reasonable and necessary, consistent with this decision.