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Workers’ Comp Case Law Update – Fall 2011

By Christopher D. Galanos

Circuit Court Does Not Have Jurisdiction Over Fraud Claims When an Application Pending

On June 30, 2011, the First District handed down its decision in Country Insurance & Financial Services v. Timothy B. Roberts. The Defendant, Timothy B. Roberts, had filed an Application for Adjustment of Claim with the Illinois Workers’ Compensation Commission alleging that he suffered an injury on January 16, 2007 while working for his employer. Country Insurance paid Roberts approximately $16,000 in temporary total disability benefits pursuant to the Workers’ Compensation Act. Later, Country discovered that Roberts had been accepting payments while working for a different employer while collecting TTD. Country then filed a Complaint in the Circuit Court alleging fraud based upon Roberts’ acceptance of TTD benefits when he knew that he was not temporary and totally disabled. The Circuit Court dismissed the claim with prejudice finding that it did not have jurisdiction and that the issues should be determined by the Illinois Workers’ Compensation Commission. The First District affirmed the Circuit Court’s decision on appeal finding that it is the particular province of the Illinois Courts to resolve questions of law, but the administrative agencies are given wide latitude in resolving factual issues. The court noted that Country’s Complaint was premised on various theories of fraud surrounding the nature of Roberts’ employment relationship with both his prior and current employers, the extent and the existence of his injury, and the representations to medical personnel regarding his injury. The Court noted that these are clearly matters of fact in which the Commission can draw on its special expertise to answer. As Country Insurance’s Complaint did not present a question of law, the cause should be before the Commission rather than the Circuit Court.

Although not clear from the decision itself, it can be inferred that had the Application for Adjustment of Claim been resolved by the Commission and all factual determinations had been made, the Circuit Court would have had jurisdiction to decide a matter of law. The decision offers some guidance as to how insurers and defense attorneys should handle future worker’s compensation fraud claims.

Police Officers Personal Deviation Does Not Take Him Out of the Scope of His Employment

On August 15, 2011 the Second District issued its opinion in Johnson v. Illinois Workers’ Compensation Commission, et al. In Johnson, the Petitioner was a Deputy Sheriff in Will County. On July 20, 2007 while on duty he left Will County and entered DuPage County to run a personal errand. After completing the errand, and while still in DuPage County, he received a call from dispatch requesting his presence at a vehicle stop in Will County. At this point, the Petitioner activated his siren and proceeded at above the posted speed limit to the traffic stop. En route he was involved in a vehicular collision in which he was broadsided and sustained injury. It was undisputed that at the time of the accident the Petitioner was in DuPage County and that his decision to leave Will County to run a personal errand without requesting and seeking permission was a violation of his employment rules.

In affirming the award of benefits the Second District began with the general rule that a deviation for purely personal reason takes an employee out of the course of his employment. Turning to the facts in the record, they acknowledged that there was no question that prior to having received the radio assignment from his dispatcher the claimant was engaged in a purely personal deviation which took him into DuPage County and further, that such a deviation was a violation of his employer’s policies. The question remained, however, whether at the time of the injury the Petitioner had completed his deviation and resumed a course of conduct related to his business of his employer. The court noted that the claimant had received instructions from his dispatcher directing him to a specific location and he was en route to that specific location at the time of the accident. As such, the Court found that only reasonable conclusion that could be drawn was that at the time of the injury the claimant was no longer embarked upon a personal deviation from his employer’s business, but was acting in the course of his employment. That the claimant was in violation of the rules of his employment was irrelevant as the decisive issue is whether the claimant was, at the time of the accident, still acting within the sphere of his employment. Citing the Illinois Supreme Court, the court held that if an employee is acting within the sphere of his employment, doing the work he is employed to do, and is injured, he is entitled to compensation even if he is guilty of violating work rules.

While the specific factual scenario presented by the Johnson case is unique, the applicable rule regarding injuries sustained when a Petitioner is violating work rules is applicable to all cases, and should be considered in determining whether a case is compensable.

First District Expands on Ghere

In Mulligan v. Industrial Commission the First District expanded on the Fourth District’s 1996 decision in Ghere v. Industrial CommissionGhere dealt with the issue of which types of physicians are bound by the “48 hour rule” located in section 12 of the Act. That rule requires a party to turn over an examining physician’s report no later than 48 hours before the hearing on the matter begins. Failure to do so could result in the physician being barred from offering his testimony. The dispute in Ghere was whether the rule applied only to physicians who performed independent medical examinations, or if it applied to treating physicians as well. The court ultimately determined that both treating, and examining physicians are bound by the requirements of Section 12.

In Mulligan the Arbitratior conducted an extended hearing which took place over three days spanning two years: April 20, 2004, July 27, 2005, and July 31, 2006. After the April 20, 2004 the Respondent, over the Petitioner’s objection took the evidence deposition of a prior treating physician whose reports had were not disclosed prior to April 20, 2004. Petitioner objected based upon the theory that the Respondent had not complied with the 48 hour rule, as the hearing began on April 20, 2004. Similarly, during the July 2005 hearing, the Respondent offered, over Petitioner’s same objection, live testimony of a second physician whose reports had not been disclosed prior to April 20, 2004. Respondent’s argument was that all the rule required was that the medical report be turned over 48 hours prior to the doctor’s testimony, not necessarily the start of the actual hearing.

In overturning the denial of benefits, the First District held that the Respondent’s expert testimony should have been barred. The court held that the term “hearing” should be given its plain and ordinary meaning and stated that compliance with section 12 of the Act dictates that the proponent of medical testimony provide the other party with the required medical reports 48 hours before evidence is presented on the first day of the arbitration hearing. The court reasoned that such a holding is consistent with the purpose of section 12, which is to prevent one party from springing surprise medical testimony on the other party.

While the court goes on to say that these requirements may be relaxed if a party can show good cause and lack of prejudice, from a practical standpoint it is always in the best interests of all parties to disclose all medical evidence needed to prosecute or defend a claim prior to the Arbitration hearing.

Originally published in the Fall 2011 edition of Quinn Quarterly.