Third Appellate District Upholds Award of Penalties for Late Advance Disability Pension Payments

In the recently decided Gage v. Workers Compensation Appeals Board, (CA3, Nov. 22, 2016 No. C081618)  the Court upheld the ability for employees to receive penalties for late advance disability pension payments. In this case, a Sacramento County Sheriff’s Deputy, represented by Greg Gomez of Mastagni Holstedt, APC, sustained a job-related injury and applied for an industrial disability retirement. In cases like these involving peace officers, the injured party can also apply for advance disability pension payments in order to cover living expenses while the disability retirement application is being decided.

Here, Gage petitioned for these advance payments and applied for industrial disability retirement on March 6, 2015. When payments did not arrive, Gage petitioned for late payment penalties against the County on June 2. The County claimed not to have received the application until June 11. The County also asserted that the Workers Compensation Appeal Board (WCAB) did not have authority over advance payments of pension because that would fall under another a different law (County Employees Retirement Law of 1937), and thus it could not apply penalties.

While this issue was being decided, the County continued to stall payments due to some additional technicalities (legal joinder). On June 29, it finally approved payment of benefits. Gage filed a petition for penalties because the benefit check wouldn’t arrive until July 2, almost 4 months after her initial request.

A workers compensation judge initially agreed with Gage that disability pension payments were considered compensation, and thus were subject to penalties for late payment. The County appealed arguing that advance pension disability payments were an obligation of the retirement system, and thus not subject to the penalty. On appeal, the WCAB overturned the workers compensation judge’s initial decision.

When the case was finally appealed to the Third Appellate District, the Court explained that the workers compensation law was intended to be liberally construed for the purpose of extending benefits to those injured in the course of employment. This includes making sure that those in law enforcement are given all the rights attendant to the workers compensation law. The advance disability pension payments are specifically provided to help officers who would otherwise have difficulty making the monthly bills if they had no income due to being injured. In fact, the payment of such benefits was made mandatory in 2002.

The Court also discredited the County’s argument that under the applicable code section, the repayment of retirement benefits was outside of WCAB’s jurisdiction. The Court stated that while the repayment of retirement benefits once disability retirement was approved was outside the scope of the WCAB’s jurisdiction, that did not bar it from asserting penalties on late payments, because such payments are considered compensation and therefore fall under WCAB’s jurisdiction. While the court remanded the case to determine if the delay in this case was sufficiently unreasonable such that penalties were required, this case still stands as a big win for employees seeking disability retirement. Mastagni Holstedt, APC is requesting that this case be published so that it has precedential value.

Mastagni Holstedt, APC is privileged to have represented the Sacramento Deputy Sheriffs Association and Ms. Gage in obtaining this important result. Greg Gomez of Mastagni Holstedt, APC represented Ms. Gage in this matter.

Court of Appeal Gives Retroactive Effect to Firefighter Injury Presumption

The California Court of Appeal ruled statutory changes to workers' compensation injury presumptions apply to cases pending prior to the change in the statute. In doing so, the Court of Appeal overruled the Workers' Compensation Appeals Board ("WCAB") who refused to apply the presumption to a pending case. This decision could affect the presumptions involved in many workers compensation cases.

 

The facts of Lozano v. W.C.A.B. are tragic. William Lozano worked as a firefighter for a Department of Defense installation. Lozano was diagnosed with stomach cancer and succumbed to the disease in September of 2007. In November of 2009, Lozano's wife and two young children filed a workers compensation claim alleging the stomach cancer was work related.

 

On January 1, 2009 the legislature amended the Labor Code so that firefighters like Lozano could take advantage of the cancer presumption. This means the family would not need to prove Lozano's employment caused stomach cancer. Rather, the court would assume the cancer was from his employment and the employer would have to prove the cancer was not job related.

 

The Agreed Medical Examiner ("AME") concluded Lozano was exposed to carcinogens as part of his work activities. However, he could not conclusively say the carcinogens caused Lozano's cancer. However, if the firefighter cancer presumption applied to Lozano's case, the AME concluded the cancer should be presumed as work related.

 

The WCAB determined the presumption did not apply to Lozano's case. The WCAB noted Lozano was not a qualifying firefighter under the statute at the time of his death. The WCAB refused to apply the statutory change retroactively because the Legislature did not provide for retroactive application in the statute.

 

The Second District Court of Appeal reversed the WCAB's decision and held the presumption did apply to Lozano's claim. In general new statutes operate prospectively unless the Legislature clearly indicates otherwise. However, this general rule does not apply to new statutes that simply alter procedural or evidentiary statutes to trials occurring after enactment. Thus, if a new statute alters substantive legal rights, like who is liable for an injury, that statute cannot be applied retroactively. But, if the statute only alters procedural rights, like who has the burden of proof, the statute can be applied retroactively.

 

Here, the presumption test does not change who is liable for the injury, but rather who has the burden of producing evidence. Making the cancer presumption available to firefighters like Lozano only addresses the procedure to follow, not the substantive legal rights. Thus, the Court of Appeal overruled the WCAB and allowed Lozano's heirs to retroactively apply the cancer presumption.

 

This case should help a great number of public safety employees in the future. The instant statute only dealt with firefighters working at Department of Defense facilities. But the court's logic could be applied to any new statute which changes the evidentiary burdens for workers compensation claims. Thus, when the legislature changes the statute to help more people, any pending claims can take advantage of that new rule.