Michael W. Mitchell v. Winnfield Holding Corp.

STATE OF LOUISIANA

COURT OF APPEAL, THIRD CIRCUIT

03-677

MICHAEL W. MITCHELL

VERSUS

WINNFIELD HOLDING CORPORATION

**************
APPEAL FROM THE
OFFICE OF WORKERS’ COMPENSATION, DISTRICT 2
PARISH OF RAPIDES, DOCKET NUMBER 02-01314
HONORABLE JAMES L. BRADDOCK, WORKERS’ COMPENSATION
JUDGE

**************
SYLVIA R. COOKS
JUDGE
**************

Court composed of Ned E. Doucet, Jr., Chief Judge, Sylvia R. Cooks, and Michael G.
Sullivan, Judges.

REVERSED AND RENDERED.

George Flournoy
Flournoy & Doggett
P.O. Box 1270
Alexandria, Louisiana 71309
(318) 487-9858
COUNSEL FOR PLAINTIFF/APPELLANT:
Michael W. Mitchell

Phillip Hendry
Johnson, Stiltner & Rahman
920 Pierremont Road, Suite 505
Shreveport, Louisiana 71106
(318) 866-9406
COUNSEL FOR DEFENDANT/APPELLEE:
Winnfield Holding Corporation

COOKS, Judge.

STATEMENT OF THE CASE

This is a workers’ compensation appeal. Plaintiff, Michael Mitchell, was

employed by Winnfield Holding Corporation, a corporation owning several

companies, including Winnfield Funeral Home and Nurturing Nook Childcare Center.

Mr. Mitchell was employed full-time for Winnfield Funeral Home and part-time for

the Nurturing Nook. His average weekly wage at the funeral home was $344.27 and

his monthly wage at the Nurturing Nook was $800.00.

On March 2, 2001, while setting up for a burial in Cloutierville, he was pulling

a 270 pound grave liner to the gravesite. The ground was muddy and he slipped,

injuring his lower back. The incident was witnessed by his co-workers and reported

to his supervisor. Mr. Mitchell was initially seen by Dr. Breazeale, a family physician

in Natchitoches. He was later referred to Dr. John Sandifer, an orthopedist, who

diagnosed a chronic lumbar strain with intermittent nerve root irritation. Dr. Sandifer

treated Mr. Mitchell until August 7, 2002.

The Louisiana Workers’ Compensation Corporation (LWCC) is the workers’

compensation insurance carrier for Winnfield Holding Corporation. Workers’

compensation benefits were initiated by LWCC based on Mr. Mitchell’s full-time

employment at Winnfield Funeral Home. His part-time employment at the Nurturing

Nook Childcare Center was not considered in the computation of benefits. Mr.

Mitchell was paid $10,744.21 in indemnity benefits, medical benefits totaling

$5,511.21 and vocational rehabilitation benefits totaling $1,837.94.

In January 2002, LWCC reduced Mr. Mitchell’s supplemental earnings benefits

(SEB) based on a job search performed by Jeff Darby, a vocational rehabilitation

consultant hired by LWCC. Mr. Mitchell continued to received SEB through the date

of trial at the reduced rate. In February 2002, Mr. Mitchell filed a Disputed Claim for

2

Compensation.

Trial on the merits was held on October 8, 2002. The workers’ compensation

judge denied Mr. Mitchell’s claim for SEB, medical benefits and vocational

rehabilitation and dismissed his claim. Mr. Mitchell filed this appeal presenting

several issues for our review:

1. Whether the workers’ compensation judge erred in not including Mr.
Mitchell’s part-time wages at the Nurturing Nook in the calculation for
benefits.

2. Whether the workers’ compensation judge erred in concluding the
medical evidence indicated Mr. Mitchell was capable of working at his
former employment at Winnfield Funeral Home.

3. Whether the workers’ compensation judge erred in terminating all
supplemental earnings, medical, and vocational rehabilitation benefits
and in not imposing sanctions and attorney fees.

For the reasons assigned below, we reverse the decision of the workers’

compensation judge and order a reinstatement of SEB using the correct calculation of

benefits, which should include both part-time and full-time wages.

LAW AND DISCUSSION

In a workers’ compensation case, appellate review of factual findings is

governed by the manifest error standard. Godeaux v. Lewis Chapman Constr. Co., 02-

0025 (La.App. 1 Cir. 12/31/02), 836 So.2d 670. The workers’ compensation judge’s

finding with regard to the credibility of the plaintiff is considered a factual finding.

Campbell v. Benson BMW/Isuzu/VW, INC., 98-861 (La.App. 5 Cir. 3/10/99), 735

So.2d 49. Thus, the findings of the worker’s compensation judge with regard to the

credibility of the plaintiff are given great weight and will be upheld on appeal if there

is a factual basis in the record to support the decision. Godeaux , 836 So.2d 670. In

Godeaux, the appellate court stated:

The two-part test for the appellate review of a factual finding is: 1)
whether there is a reasonable factual basis in the record for the finding

3

of the trial court, and 2) whether the record further establishes that the
finding is not manifestly erroneous. Mart v. Hill, 505 So.2d 1120, 1127
(La.1987). Thus, if there is no reasonable factual basis in the record for
the trial court’s finding, no additional inquiry is necessary for a finding
of manifest error.

Id. at 676 (emphasis added).

In this case, the workers’ compensation judge based his decision to terminate

SEB almost entirely on his assessment of the credibility of Mr. Mitchell to the

exclusion of the documented evidence, including medical evidence, found in the

record. The workers’ compensation judge excluded Mr. Mitchell’s part-time

employment in the computation of benefits, finding Mr. Mitchell was still working

part-time. There is no evidence in the record to support this finding. Additionally,

the workers’ compensation judge concluded Mr. Mitchell is able to work at his former

employment at Winnfield Funeral Home performing heavy manual labor, a conclusion

which is contrary to the medical evidence. We find the decision of the workers’

compensation judge terminating all SEB is unsupported by the record and, therefore,

manifestly erroneous.

Calculation of Benefits

Mr. Mitchell earned $344.27 weekly from his full-time employment at

Winnfield Funeral Home and $800.00 monthly from his part-time employment at the

Nurturing Nook Childcare Center. Both companies were owned by the same

individual, Ben Johnson. Benefits were paid to Mr. Mitchell using only the wage

calculation from his full-time employment at Winnfield Funeral Home. Excluding the

wages from his part-time employment was improper. Glynn v. City of New Orleans,

95-1353 (La.App. 4 Cir. 4/3/96), 672 So.2d 1112. In Glynn, the plaintiff was

employed as a fire fighter for the City of New Orleans. In addition to his job with the

City he worked for Delgado City College part-time and also received supplemental

pay from the State of Louisiana. Mr. Glynn injured his back while working for the

4

City of New Orleans. The court concluded: “Glynn’s additional revenues from the

employment other than the City and his state supplemental pay were properly included

in his earnings to calculate his SEB. See Jones v. Orleans Parish School Board, 370

So.2d 677 (La.App. 4 Cir. 1979).” Id. at 1115.

The workers’ compensation judge concluded Mr. Mitchell failed to prove he

lost his job at the Nurturing Nook as a result of the accident. He based this finding on

the deposition of Lance Crappell, CPA, and on the Vehicle Detailing and Maintenance

Contract signed by Mr. Mitchell on May 29, 2000 with the Nurturing Nook. Neither

of these documents supports the workers’ compensation judge’s conclusion.

The Vehicle Detailing and Maintenance contract indicates Mr. Mitchell was

paid $200.00 a month to wash and “perform detailing and preventative maintenance

on the two rental vans assigned to the Ben D. Johnson Nurturing Nook Child Care

Center.” The attachment to the contract reflects payment to Mr. Mitchell of $200.00

on November 30, 2000 for these responsibilities. In addition, Mr. Mitchell testified

he cut the grass, mopped bathrooms and performed repair work on Nurturing Nook

property. For these responsibilities the record reflects he received $600.00 on

November 30, 2000. This document supports proof of employment at the Nurturing

Nook and the amount of compensation but it does not support a finding that he

continued to work after the accident which occurred on March 2, 2001.

The workers’ compensation judge also relied on the deposition of Lance

Crappell, a CPA, who was payroll administrator for the Ben Johnson Educational

Foundation. Attached to the deposition of Mr. Crappell was the Employment History

Report for Mr. Mitchell. The report reflects two payments to Mr. Mitchell after the

date of the accident. The first payment was on March 31, 2001 for $800.00 and the

second payment was on April 27, 2001 for the reduced amount of $400.00. Mr.

Mitchell testified one check was for work performed prior to the date of the accident

5

and the other check was for work performed by his brother-in-law and his nephew on

his behalf. There are no other payments after April 27, 2001. This document does not

support the workers’ compensation judge’s conclusion that Mr. Mitchell continued to

work for the Nurturing Nook on a regular basis after the date of the accident.

Additionally, testimony from Lance Crappell indicates the bookkeeping at the

Ben Johnson Educational Foundation contained “some irregularities or potentially

fraudulent activities. . . . [T]he thing was losing so much money, and apparently had

so many irregularities going on, that the board members of the Educational

Foundation decided that it was not a venture that they wanted to continue, so they

forced it to shut down.” The workers’ compensation judge completely disregarded

Mr. Mitchell’s testimony regarding his employment at the Nurturing Nook and instead

relied on admittedly unreliable payroll information to deny Mr. Mitchell’s claim for

benefits.

The workers’ compensation judge found Mr. Mitchell concealed his part-time

job at the Nurturing Nook from Annette Robinson, claims manager for LWCC. It is

not clear what benefit Mr. Mitchell would obtain by concealing his part-time

employment at the Nurturing Nook from Ms. Robinson since he was entitled to have

both part-time and full-time wages calculated in determining his benefits. The

following exchange occurred between Ms. Robinson and Mr. Mitchell’s attorney

regarding his part-time employment:

Q. Would you tell the Judge then when I first made demand do you
recall in my - letter I said that - I told you that he was working at -
at part-time employment? Tell the Judge what you did, if
anything, to find out the nature of his work, the part-time
employment, how much he was making and so forth.

A. I responded to your letter on March the 6th by way of letter
advising you that we had received your letter of representation,
that we were advised of the second job and to let you know that
Mr. Mitchell had not recorded having worked a second job even
though he was asked that question in his recorded statement. I

6

requested any information for review that you might have on
wages from the second job, asked you to submit that to me and we
would be glad to review it and get back with you.

Q. Okay. But let me ask you what did you do to investigate? Did
you contact the Nurturing Nook? This was Ben Johnson -

A. No, sir, I did not.

LWCC did not include the part-time wages in the calculation of benefits

claiming they were unaware of Mr. Mitchell’s job at Nurturing Nook. However, Jeff

Darby, the vocational rehabilitation consultant hired by LWCC, was aware of Mr.

Mitchell’s part-time employment with Nurturing Nook in July 2001. Moreover, Mr.

Mitchell knew Ben Johnson and knew Mr. Johnson owned both Winnfield Funeral

Home and the Nurturing Nook. It is reasonable to conclude Mr. Mitchell believed the

two companies were actually one and the same employer.

While LCWW claims it did not know about the part-time employment, Ms.

Robinson testified even if she had known about the part-time employment, the

workers’ compensation statute, as she reads it, entitled Mr. Mitchell to wages only up

to forty hours per week. She stated: “And I indicated that to Mr. Flournoy in my

letter, that I had given him the benefit of forty hours.” We find Mr. Mitchell’s part-

time employment at the Nurturing Nook should have been included in the calculation

of his benefits.

Medical Evidence

Mr. Mitchell’s medical history indicates he had bilateral carpel tunnel surgery in

1998. As a result Dr. Sandifer estimated he had “approximately 5% permanent partial

medical impairment of both upper extremities, secondary to the work related carpal

tunnel syndromes and carpal tunnel releases.” Dr. Sandifer advised him to engage in

no “repetitive lifting over 20 pounds. He also should avoid activities that involve

repetitive wrist flexion or extension.” Mr. Mitchell returned to Dr. Sandifer’s office

7

in July 7, 2000 for a flare up of his hands and wrists. Dr. Sandifer’s office notes on

that date reflect the following:

Today, he has obvious swelling and tenderness in his hands and wrists.
He has difficulty straightening his fingers out. I am sure that he has
tendinitis of both hands and wrists with some median nerve irritation.
He needs to be on restricted work activity with no lifting over 10 to 15
pounds and no repetitive wrist flexion extension activities. I placed him
back in wrist splints and he needs to elevate his hands and wrists.

On April 2, 2001, Mr. Mitchell returned to Dr. Sandifer for

treatment following his back injury at Winnfield Funeral Home. Dr.

Sandifer diagnosed a chronic lumbar strain with intermittent nerve root

irritation. An MRI taken on May 11, 2001 was normal. Dr. Sandifer

ordered a FCE which was performed on August 14, 2001. The FCE

report reflects the following:

Mr. Mitchell was able to demonstrate his dynamic lifting capacity at
Medium level of physical demand. However, his test results indicate
bilateral grip and pinch strength weakness as well as limitation in lumbar
active range of motion. With these factors, and his low perceived level
of function, a return-to-work status at a Medium level would not be
possible. A [l]ight physical demand level would allow material handling
in the 1 to 10 lb. range for 34 to 66% of the work day.

Dr. Sandifer’s office notes for September 7, 2001 provide:

Mr. Mitchell comes back and is still having a good bit of back pain and
bilateral leg pain. I have reviewed his MRI Scan again and he obviously
does not have any ruptured disc or anything that might need surgery. He
probably could go back to some form of light to sedentary type work.
He cannot go back to his prior employment because of the amount of
bending and lifting that he has to do.

Dr. Sandifer’s office notes of October 17, 2001 indicate:

Mr. Mitchell comes in and is basically having the same complaints as
before with his back. I feel like he is not a candidate for any type of
surgery. He could certainly go back to some form of light duty at this
point and time. He probably should not do repetitive bending or lifting
over 20 pounds. I have also reviewed several job descriptions today for
approval or disapproval. I have refilled his medications also. He needs
to continue on a good walking and exercise program. I feel like he is at
MMI.

8

Dr. Sandifer’s office notes of December 18, 2001 reflect the following:

[Mr. Mitchell] could go back to some form of light duty with no
repetitive bending or lifting over 20 pounds. I don’t feel like he can go
back to his prior employment, which involved a great deal of heavy
lifting.

Mr. Mitchell’s last visit with Dr. Sandifer was on August 7, 2002. Dr.

Sandifer’s deposition testimony was consistent with his office notes. He testified:

I think he shouldn’t do repetitive bending at the waist. He shouldn’t lift
over fifteen to twenty pounds. He shouldn’t stand for over forty-five
minutes to an hour at a time up to five hours in an eight hour day. He
probably shouldn’t sit over thirty to forty-five minutes at a time up to
four to five hours in an eight hour day. . . . He probably – if he’s driving,
he may need to stop and get out and stretch every forty-five minutes to
an hour or so.

The workers’ compensation judge found Mr. Mitchell could return to his

employment at Winnfield Funeral Home. He stated:

Doctor Sandifer only released him from employment at the
funeral home under the belief that there was no light-duty work
available.

Subsequently Mr. Darby in his vocational rehabilitation efforts
locates jobs that involve washing and detailing and waxing motor
vehicles, precisely what Mr. Mitchell was doing at the Nurturing Nook.
I really doubt that he did anything other for the Nurturing Nook but wash
vans.

So he was capable of the light-duty work of washing vans. He
was taken off of only heavy-duty work. It’s clear to this Court that if had
Doctor Sandifer known he has a job at the Nurturing Nook washing vans
that Doctor Sandifer would have permitted him to continue that work.
The records reflect he received some monies from the Nurturing Nook
all the way through the end of April 2001.

There’s an FCE that says he can do light-duty work. His only
explanation that he can’t do any work at all is his complaints of pain
which are totally disregarded by this Court because he lacks complete
credibility.

He has no objective medical evidence of - of any injury to his
back. His neurological examinations are normal. His orthopedic
examinations are normal except for the very beginning when he does
have spasms and a positive straight leg raising test.

9

An MRI was performed, reported by Doctor Sandifer as normal.
The MRI results from the radiologist are not in the records so there’s no
indication that he has a bulging disk or even degenerative back disease.
....

Moreover Mr. Mitchell had carpal tunnel surgery as a result of
prior employment with ConAgra. And in May of 1999 Doctor Sandifer
gave permanent restrictions to Mr. Mitchell of not lifting over ten to
fifteen pounds, stated that these were permanent restrictions. Well, these
are the same restrictions that Doctor Sandifer has placed upon Mr.
Mitchell after examining for this back problem.
....
And this Court concludes that he’s entirely uncredible as to his
complaints. Observed him carefully during the trial, went through the
records very carefully.
....
He has not shown this Court that he’s unable to do the same type
of work he was able to do when he began his employment with the
Winnfield Holding Corporation.

The record does not support the finding of the workers’ compensation judge

that Mr. Mitchell could return to his prior employment. The medical evidence

indicates Mr. Mitchell was capable of light duty work but was not capable of returning

to Winnfield Funeral Home due to the heavy lifting. The workers’ compensation judge

found he was capable of returning to his job at the Nurturing Nook because “ I really

doubt that he did anything other for the Nurturing Nook but wash vans.” There is no

evidence in the record to support this conclusion. In fact, it seems unlikely that any

employer would pay an employee $800.00 a month to wash and detail two vans. Mr.

Mitchell testified, in addition to washing the vans (for which he was paid $200.00 a

month), he maintained the property and buildings for the Nurturing Nook for which

he received another $600.00 a month. If his job at the Nurturing Nook was considered

light duty work, and was available to Mr. Mitchell, LWCC could have placed

evidence of this fact in the record. It did not. In fact, no witness representing

Winnfield Funeral Home or the Nurturing Nook testified at trial. While the medical

evidence does support a finding Mr. Mitchell was capable of light duty work, we must

determine whether LWCC met its burden of proving light duty job availability to

10

justify a reduction in benefits to Mr. Mitchell.

Vocational Rehabilitation

In order for an employer to satisfy its burden of proving job availability the

Louisiana Supreme Court in Banks v. Industrial Roofing & Sheet Metal Works, Inc.,

96-2840 (La. 7/1/97), 696 So.2d 551, stated:

[A]n employer may discharge its burden of proving job availability by
establishing, at a minimum, the following, by competent evidence:
(1) the existence of a suitable job within claimant’s physical
capabilities and within claimant’s or the employer’s community or
reasonable geographic region;
(2) the amount of wages that an employee with claimant’s
experience and training can be expected to earn in that job; and
(3) an actual position available for that particular job at the time
that the claimant received notification of the job’s existence.
By “suitable job,” we mean a job that claimant is not only
physically capable of performing, but one that also falls within the limits
of claimant’s age, experience, and education, unless, of course, the
employer or potential employer is willing to provide any additional
necessary training or education.

Id. at 557.

In June 2001, LWCC hired Jeff Darby, a vocational rehabilitation consultant,

to perform a job search. Mr. Darby met with Mr. Mitchell three times during the

summer and also met with Dr. Sandifer to discuss Mr. Mitchell’s work ability. Mr.

Darby testified he located a cleanup person position at $6.00 per hour through Job

Service and two porter positions. These jobs were available on October 3, 2001. Mr.

Darby received approval of these jobs from Dr. Sandifer. He sent a certified letter

dated October 3, 2001 to Mr. Mitchell notifying him of these jobs. He also spoke to

Mr. Mitchell by telephone on October 11, 2001. Mr. Darby also located a van driver

job. Mr. Mitchell did indicate he would apply for the van driver job and admitted to

knowing the owner of the company.

Mr. Darby did a second labor market survey by contacting an assistant in the

Natchitoches area to identify job leads. On October 10, 2001 he sent a second letter

11

by certified mail to Mr. Mitchell. The letter indicated available jobs with Red River

Janitors and Aramark, a food service contractor. Both jobs were on the Northwestern

College campus. Mr. Darby received prior approval from Dr. Sandifer for these jobs

as well. Mr. Darby received a response from James Jefferson at Red River Janitors

who indicated Mr. Mitchell did not want an interview. At trial, Mr. Darby was

questioned as to whether these jobs were simply job leads or job openings.

Mr. Darby testified there were job openings:

Judge, it was my impression that they had job openings. And what
I put in my letter to Mr. Mitchell is to apply for the jobs that are
available. So I called it a job lead, because even if he applies - if he
doesn’t apply timely then he would not even be considered for the job.
So my - my emphasis is on the - the injured worker applying for this job,
because on the date that I spoke with the employer then would accept his
application.

Mr. Darby testified the clean-up person and the two porter jobs were full-time

jobs. The college campus jobs were part-time with full-time potential. We find

LWCC was justified in reducing Mr. Mitchell’s benefits based on the job search

performed by Mr. Darby. The medical evidence supports a finding Mr. Mitchell was

able to perform light duty work and Mr. Darby testified such work was available to

him. LWCC reduced Mr. Mitchell’s benefits in January 2002 using the lowest paying

job available at $5.15 per hour, forty hours per week. While LWCC was justified is

reducing Mr. Mitchell’s benefits, the workers’ compensation judge went even further

and terminated all SEB. We find this was error on the part of the workers’

compensation judge.

The purpose of SEB is to compensate an injured employee for the loss of wage

earning capacity. Pinkins v. Cardinal Wholesale Supply, Inc., 619 So.2d 52

(La.1993). An employee is entitled to receive SEB if he sustains a work-related injury

that results in his inability to earn ninety percent (90%) or more of his average pre-

injury wage. La.R.S. 23:1221(3)(a). The amount of SEB is based upon the difference

12

between the claimant’s pre-injury average monthly wage and the claimant’s proven

post-injury monthly earning capacity. Id. The evidence establishes Mr. Mitchell was

earning approximately $2,100.00 a month prior to his accident performing primarily

medium to heavy duty work. After the accident he was restricted to light duty work.

He is entitled to SEB based upon the difference between his pre-injury average

monthly wage and his post-injury earning capacity.

We reverse that decision of the workers’ compensation judge terminating all

SEB. We order reinstatement of SEB benefits based upon the difference between Mr.

Mitchell’s pre-injury wage, using both his full-time and part-time wages, and his post-

injury earning capacity, which was determined to be light duty work. We also reverse

the decision of the workers’ compensation judge terminating all medical benefits and

order a reinstatement of medical benefits.

Penalties and Attorney Fees

LWCC miscalculated Mr. Mitchell’s wages using only his full-time

employment. Ms. Robinson testified from her reading of the workers’ compensation

statute Mr. Mitchell was only entitled to wages up to forty hours per week. In Ben v.

Holtrachem, Inc., 00-635 (La.App. 3 Cir. 11/2/00), 772 So.2d 326, this court held:

The rule is well-settled that a workers’ compensation claimant is entitled
to penalties and attorney fees if benefits are withheld. To avoid the
imposition of penalties and attorney fees an employee’s right to
compensation has to be reasonably controverted. La.R.S. 23:1201(F)(2).
. . . [T]he proper method to calculate his AWW would be to give him
credit for an eighty hour work week for the pay period ending May 16,
1993. Mr. Ben’s wages were not reasonably controverted but withheld
because of miscalculations and the failure of LWCC to acquire written
payroll records from Cal Chlor at the time of the accident.

Id. at 329-30.

Likewise, we find LWCC could have inquired from their insured about Mr.

Mitchell’s part-time as well as full-time employment. Additionally, Ms. Robinson

could have obtained the advice of counsel before interpreting the provisions of the

13

workers’ compensation act on her own. Under the circumstances, we find Mr.

Mitchell is entitled to penalties and attorney fees for LWCC’s failure to reasonably

controvert his claim. Accordingly, we award a penalty of $2,000.00 and attorney fees

of $5,000.00 for work at the trial level and $2,500.00 for work at the appellate level.

Additionally, Mr. Mitchell asks for penalties for termination of vocational

rehabilitation services. It does not appear from the record that the employer

terminated vocational services. LWCC hired Mr. Darby on a contract basis to locate

available jobs. Mr. Mitchell did not avail himself of those jobs. It is not clear from

the evidence what other vocational rehabilitation services Mr. Mitchell is seeking

from the employer. We do not that find the employer terminated vocational

rehabilitation services or that Mr. Mitchell has demonstrated he made demand for

vocational services which were then refused by the employer. Therefore, we decline

to award penalties.

DECREE

Based on the foregoing review of the evidence, we reverse the decision of the

workers’ compensation judge terminating all SEB and medical benefits. We reinstate

SEB benefits based upon the difference between Mr. Mitchell’s pre-injury wage, using

both his full-time and part-time wages, and his post-injury earning capacity, which

was determined to be light duty work. We order a reinstatement of medical benefits,

a $2000.00 penalty for improper calculation of benefits, and $7500.00 in attorney fees.

All costs for this appeal are assessed to LWCC.

REVERSED AND RENDERED.

14