Larry Thilmony v. Schwan's Foods

This workers’ compensation case is submitted to the Labor and Industrial Relations Commission (Commission) for review as provided by § 287.480 RSMo. We have reviewed the evidence, read the parties’ briefs, heard the parties’ arguments, and considered the whole record. Pursuant to § 286.090 RSMo, we modify the award and decision of the administrative law judge. We adopt the findings, conclusions, decision, and award of the administrative law judge to the extent that they are not inconsistent with the findings, conclusions, decision, and modifications set forth below.

The parties asked the administrative law judge to resolve the sole issue of the liability of the Second Injury Fund.

The administrative law judge determined that the Second Injury Fund is liable for permanent total disability benefits beginning July 1, 2015.

Employee filed a timely application for review with the Commission alleging the administrative law judge erred in determining that employee was not permanently and totally disabled until July 1, 2015, and that the administrative law judge should have instead determined that employee’s permanent and total disability began on his last date of employment with employer.

The Second Injury Fund filed a timely application for review with the Commission alleging the administrative law judge erred in determining that employee is permanently and totally disabled based upon a combination of his primary injury and preexisting disabilities.

For the reasons set forth in our decision herein, we modify the administrative law judge’s award with respect to the date of commencement of the Second Injury Fund’s liability for permanent total disability benefits.

On July 21, 2009, this delivery driver of over 20 years slipped and fell on a wet flight of stairs at work, suffering injuries affecting his right knee and right shoulder. He seeks an award of permanent total disability benefits from the Second Injury Fund based on a combination of the effects of this injury and his preexisting permanent partially disabling

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conditions affecting the left hip, left shoulder, left knee, and body as a whole in the form of a cardiovascular disorder. Employee stopped working for employer during the summer of 2010. Thereafter, he provided some assistance to his wife with a daycare business that she operated from their home through the summer of 2015. The Second Injury Fund argues that this latter activity shows that employee is not permanently and totally disabled, and that it amounted to employment in the open labor market.

In her findings, the administrative law judge expressly credited the testimony from the employee describing his limitations stemming from the combination of his primary 2009 work injury and his preexisting disabling conditions. We are mindful that the administrative law judge was able to observe employee as he testified at the hearing, and we are reluctant to reverse her express credibility call in this regard absent a compelling reason to do so. After careful consideration, we do not find a reason to do so here. Accordingly, we defer to her finding and adopt it as our own. For this reason, and because we otherwise agree that the combination of employee's work injuries and his preexisting disabling conditions render him unable to compete in the open labor market in light of his age, education, and work history, we affirm the award of permanent total disability benefits.

However, we note that the administrative law judge determined that employee was not permanently and totally disabled until July 1, 2015, based on an implicit finding that employee's actions in helping his wife with her in-home daycare business demonstrated employee had an ability to compete for work in the open labor market until that business closed at some point in the summer of 2015. We disagree, for the following reasons.

Courts have used various terms to determine when an employee's condition has reached the point where further progress is not expected, including the term maximum medical improvement. Vinson v. Curators of the University of Missouri, 822 S.W.2d 504, 508 (Mo. App. E.D. 1991)(interpreting a doctor's testimony of employee's maximum treatment potential to mean maximum medical improvement); Cooper, 955 S.W.2d at 575 (using the term maximum medical progress to define the point where no further progress is expected for an employee's condition).

After reaching the point where no further progress is expected, it can be determined whether there is either permanent partial or permanent total disability and benefits may be awarded based on that determination. One cannot determine the level of permanent disability associated with an injury until it reaches a point where it will no longer improve with medical treatment. ...

Although the term maximum medical improvement is not included in the statute, the issue of whether any further medical progress can be reached is essential in determining when a disability becomes permanent and thus, when payments for permanent partial or permanent total disability should be calculated.

As the foregoing language from the Cardwell decision makes clear, the appropriate date for assigning liability for the payment of permanent total disability benefits will generally coincide with the date upon which an employee reaches maximum medical improvement from the effects of the work injury. This is because, at that point, the nature and extent of any permanent disability referable to the effects of the work injury may be calculated. By the same token, the fact-finder is then able to assess the nature and extent of any permanent disability that results from the combination of the primary injury with employee's preexisting conditions of ill-being. Stated another way, if employee was not permanently and totally disabled owing to his continued work for his wife's daycare, he did not suddenly become so disabled when she closed that business during the summer of 2015, as this event did not change employee's medical status, physical condition, or overall ability to compete for work.

As an aside, with regard to employee assisting his wife with her in-home daycare business, we are not persuaded by the contention from the Second Injury Fund that such represented gainful employment in the open labor market. First, as we have noted, the administrative law judge expressly credited employee's testimony with regard to his physical limitations; consequently, she implicitly determined that employee's physical activities for the daycare, such as sitting and watching children, holding infants, and walking children $1 / 2$ block to and from the bus stop, did not ultimately undermine his credible testimony with regard to the issue of permanent total disability. We have deferred to her determination in this regard. Second, the Missouri courts have never required that a disabled employee remain "completely inactive or inert" to receive an award of permanent total disability benefits, Grgic v. P \& G Constr., 904 S.W.2d 464, 466 (Mo. App. 1995), and have consistently held that post-injury work obtained through means other than competition in the open labor market (such as from a friend or family member) does not preclude an award of benefits. Minnick v. South Metro Fire Protection Dist., 926 S.W.2d 906, 910 (Mo. App. 1996).

Turning back to the issue when employee reached maximum medical improvement, we note that employee's treating surgeon for the primary right shoulder injury, Dr. John Havey, released employee from his care on April 5, 2010. This appears to be the date upon which employee reached maximum medical improvement from the effects of the work injury; the parties, in any event, do not argue otherwise. Consequently, it would appear that the Second Injury Fund's liability for permanent partial disability benefits began on April 5, 2010.

However, we note that employee, in his brief, requests an award of permanent total disability benefits beginning on August 7, 2010. We will not second-guess employee where he is willing to stipulate that he is not entitled to permanent total disability benefits until August 7, 2010. Accordingly, we modify the award of the administrative law judge regarding the date of commencement of permanent total disability benefits. The Second Injury Fund is liable for permanent total disability benefits beginning August 7, 2010.

**Employee: Larry Thilmony**

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We modify the award of the administrative law judge as to the issue of the date that the Second Injury Fund became liable for permanent total disability benefits.

The Second Injury Fund is liable for permanent total disability benefits beginning August 7, 2010, at the differential rate of $62.69 for 52.6 weeks, and thereafter at the stipulated weekly permanent total disability benefit rate of $485.66. The weekly payments shall continue for employee's lifetime, or until modified by law.

The award and decision of administrative law judge Hannelore D. Fischer, issued February 25, 2016, is attached hereto and incorporated by this reference to the extent not inconsistent with our findings, conclusions, decision, and modifications herein.

The Commission further approves and affirms the administrative law judge's allowance of attorney's fees herein as being fair and reasonable.

Any past due compensation shall bear interest as provided by law.

Given at Jefferson City, State of Missouri, this 15th day of December 2016.

**LABOR AND INDUSTRIAL RELATIONS COMMISSION**

John J. Larsen, Jr., Chairman

James G. Avery, Jr., Member

Curtis E. Chick, Jr., Member

Attest:

Secretary

1. Are any benefits awarded herein? Yes
2. Was the injury or occupational disease compensable under Chapter 287? Yes
3. Was there an accident or incident of occupational disease under the Law? Yes
4. Date of accident or onset of occupational disease: July 21, 2009
5. State location where accident occurred or occupational disease was contracted: Miller County, Missouri
6. Was above employee in employ of above employer at time of alleged accident or occupational disease? Yes
7. Did employer receive proper notice? Yes
8. Did accident or occupational disease arise out of and in the course of the employment? Yes
9. Was claim for compensation filed within time required by Law? Yes
10. Was employer insured by above insurer? N/A
11. Describe work employee was doing and how accident occurred or occupational disease contracted: See Award
12. Did accident or occupational disease cause death? No. Date of death? N/A
13. Part(s) of body injured by accident or occupational disease: Right shoulder; Right knee
14. Nature and extent of any permanent disability: 17.5 % right shoulder; 7.5 % right knee
15. Compensation paid to-date for temporary disability: N/A
16. Value necessary medical aid paid to date by employer/insurer? N/A

Employee: Larry Thilmony Injury No. 09-062797

1. Value necessary medical aid not furnished by employer/insurer? N/A
2. Employee's average weekly wages: ---
3. Weekly compensation rate: $\ 485.66 TTD, PTD/ \$422.97 PPD
4. Method wages computation: By agreement

1. Amount of compensation payable: Employer previously settled.
2. Second Injury Fund liability: Yes. Ongoing permanent total disability benefits from July 1, 2015 with a credit of 52.6 weeks of $\ 422.97 for PPD paid by employer/insurer.
3. Future Requirements Awarded: Yes. Permanent and total disability benefits from July 1, 2015

Said payments to begin immediately and to be payable and be subject to modification and review as provided by law.

The compensation awarded to Claimant shall be subject to a lien in the amount of 20 % of all payments hereunder in favor of the following attorney for necessary legal services rendered to the claimant: Matt Uhrig.

Employee: Larry Thilmony

Injury No: 09-062797

Dependents: N/A

Employer: Schwan's Foods

Additional Party: N/A

Insurer: N/A

The above-referenced workers' compensation claim was heard before the undersigned administrative law judge on February 2, 2016. Memoranda were due by February 19, 2016.

The parties stipulated that on or about July 21, 2009, the claimant, Larry Thilmony, was employed by Schwan's Foods. The parties stipulated that all facts relevant to the claimant's relationship with the employer/insurer are decided in the claimant's favor in his pending claim against the Second Injury Fund. The compensation rate is $\ 422.97 per week for permanent partial disability benefits and $\ 485.66 per week for temporary and permanent total disability benefits.

The issue to be resolved by hearing is the liability of the Second Injury Fund (permanent total disability is alleged).

The parties stipulated that the claim against the employer/insurer settled based on a permanent disability of 17.5 percent of the right shoulder and 7.5 percent of the right knee; the parties did not stipulate that the settlement percentages represent the extent of disability resulting from the July 21, 2009 accident and injury.

The parties stipulated that a 2007 workers' compensation claim against the employer/insurer settled based on a permanent disability of 10 percent of the left shoulder and 42 percent of the left hip; the parties did not stipulate that the settlement percentages represent the extent of disability resulting from the January 16, 2007 accident and injury.

The parties further stipulated that a 1998 workers' compensation claim against the employer/insurer settled based on a permanent disability of 17 percent of the left knee; the parties did not stipulate that the settlement percentage represents the extent of disability resulting from the 1998 accident and injury.

The claimant, Larry Thilmony, testified that he is 69 years old as of the date of hearing and was born on May 31, 1946. Mr. Thilmony testified that he started working with Schwan's Foods in

1986 as a driver/route salesperson. As a driver/route salesperson, Mr. Thilmony worked 12 to 14 hours a day on the route delivering food to homes and then returned to the "depot" to handle the paperwork documenting the day's sales. An average day included contact with 80 to 100 customers, according to Mr. Thilmony. Mr. Thilmony said that his workday usually began at 8:00 am and ended at 10:00 pm. Driver/route salespeople worked five to six days a week, regardless of weather, holidays, or sickness. Mr. Thilmony was promoted to a sales manager position with driver/route salespeople working under him in 1990. However, in 1993 Mr. Thilmony developed heart problems and in 1994 he stepped back down to a driver/route salesperson position.

On January 16, 2007, Mr. Thilmony was returning to his truck while making a Schwan's Foods delivery to a home in Jefferson City when he fell on the ice hitting the curb, injuring his left hip and his left shoulder. Mr. Thilmony described having immediate left hip surgery to replace the ball and socket of his hip as well as surgery to repair his torn left rotator cuff on May 16, 2007.

Mr. Thilmony returned to his regular job at Schwan's Foods as a driver/route salesperson. Mr. Thilmony described ongoing pain in his left hip and left shoulder at night, keeping him from sleeping through the night. Mr. Thilmony said the left hip slowed him down getting in and out of the truck and making his deliveries. The left shoulder injury has kept Mr. Thilmony from being able to fully raise his left arm and to being able to reach behind him at belt level.

On July 21, 2009, Mr. Thilmony was injured again while climbing metal stairs with metal railings making a Schwan's Food delivery to a condominium. It was "pouring rain" and Mr. Thilmony slipped, injuring his right knee and right shoulder. Mr. Thilmony had a medial meniscus repair in his right knee performed by Dr. Beckett followed by a torn rotator cuff and biceps tear in his right shoulder by Dr. Havey.

Mr. Thilmony returned to his regular job at Schwan's Foods as a driver/route salesperson in January of 2010. Mr. Thilmony testified that his right knee and right shoulder never fully recovered after the treatment for the injuries.

Mr. Thilmony testified to a left knee injury for which he had surgery in 1998 while working for Schwan's Foods, but said that his left knee did not bother him before the 2007 accident. Mr. Thilmony also testified to two subsequent left knee arthroscopic surgeries in 2002 and 2004 after slipping on a deck in 2002. In 1991 Mr. Thilmony injured his right foot and ankle when he slipped off the side of a black top road; Mr. Thilmony missed a few weeks of work as the result of this injury. In 1993, Mr. Thilmony injured his left shoulder when the front wheels of his car hit a "wash out" and his left shoulder was hit by the steering wheel and the door. Mr. Thilmony also testified to a heart condition in 1993 that caused him to have to leave his managerial position with Schwan's Foods because of the stress involved with that position; Mr. Thilmony said that after his heart attack and bypasses he returned to Schwan's Foods as a route driver.

Mr. Thilmony stated that all of his injuries affected his ability to work and that he therefore quit working in 2010. Mr. Thilmony specifically cited difficulty getting in and out of his truck and reaching for product as work activities he found difficult as the result of his injuries.

Mr. Thilmony produced a paycheck which indicated that he got paid for work at Schwan's Foods on August 12, 2010, for the period of July 25, 2010, through August 7, 2010. Mr. Thilmony testified that this was his last payment for work performed for Schwan's Foods.

Mr. Thilmony testified that he graduated from high school and had one year of education at Dakota Business College in Fargo, North Dakota, where he learned penmanship and bookkeeping. At the time, Mr. Thilmony felt this education would prepare him for a position with a bank. Mr. Thilmony left Dakota Business College after one year for a job as a night auditor for a hotel. Mr. Thilmony next worked for a dairy producing ice cream and making deliveries. Mr. Thilmony also worked for a beer distributorship and then owned and operated a bar with his wife until it was destroyed by fire. Mr. Thilmony then began his employment with Schwan's Foods in 1986.

After Mr. Thilmony left Schwan's Foods he helped his wife run her in home day care by reading to the children, watching them play in the yard, and picking them up from school. Mr. Thilmony believed that if he had gotten another job his wife would have had to hire a replacement for him. Mrs. Thilmony quit operating the day care in 2015 due to her own health concerns.

Mr. Thilmony testified to applying for work with a gravel company after he left Schwan's Foods, for which he renewed his commercial driver's license; however, according to Mr. Thilmony, he was not hired because the owner felt he could not handle shoveling the gravel.

In his deposition testimony, Mr. Thilmony made several references to retiring from Schwan's Foods in 2011 when he reached the age of 65 .

An "earnings statement" for Mr. Thilmony for the pay period of July 25, 2010, through August 7, 2010, reflects a copy of a check dated August 12, 2010, in the amount of $\ 819.28, which appears to be pay for base plus commission, vacation payout and "taxblins" less pretax deductions, taxes and after tax deductions. (exh 34)

Dr. David Volarich, board certified in nuclear medicine, occupational medicine, and as an independent medical examiner, testified by deposition that he saw Mr. Thilmony twice, in 2009 and again in 2014. As the result of the 2007 accident, Dr. Volarich opined that Mr. Thilmony sustained a permanent disability of 40 percent of the left shoulder and 65 percent of the left hip. Preexisting the 2007 injuries, Dr. Volarich opined to a permanent disability of 25 percent of the left shoulder, 25 percent of the right shoulder, 25 percent of the body as the result of Mr. Thilmony's cardiac condition, 5 percent of the right ankle, and 50 percent of the left knee. Dr. Volarich further opined that "the combination of the disabilities creates a substantially greater disability than the simple sum or total of each separate injury or illness." (Volarich depo p32, 115-18)

As the result of the 2009 accident, Dr. Volarich opined that Mr. Thilmony sustained a permanent disability of 40 percent of the right knee and 40 percent of the right shoulder. Preexisting the 2009 injuries, Dr. Volarich opined to a permanent disability of 25 percent of the right shoulder, 70 percent of the left shoulder, 65 percent of the left hip, 25 percent of the body as the result of Mr. Thilmony's cardiac condition, 50 percent of the left knee, and 5 percent of the right ankle.

Dr. Volarich further opined that "the combination of his disabilities creates a substantially greater disability than the simple sum or total of each separate injury/illness." (Volarich depo p51, 120-23) Dr. Volarich went on to say that in his opinion Mr. Thilmony is permanently and totally disabled as the result of his July 21, 2009 injuries in combination with his preexisting injuries.

Mr. Thilmony told Dr. Volarich that he retired in July of 2011 from his work at Schwan's Foods, according to Dr. Volarich, and counsel for Mr. Thilmony reiterated, "Just so we're clear, that's July of 2011?", to which Dr. Volarich replied affirmatively. (Volarich depo p38, 122-23)

James England, vocational rehabilitation counselor, testified by deposition that he reviewed Mr. Thilmony's records and issued a report based thereon on September 14, 2015. Mr. England felt that Mr. Thilmony is employable in the open labor market, even given Dr. Volarich's restrictions; in support of his position, Mr. England cited "a variety of things that he could do; some of which are related to what he's done before including sales, customer service. I mean that's directly in line with what he's done. He's been a desk clerk at a motel before or a night clerk, night auditor. That would be something he could return to, and I think there are also alternative entry-level kinds of things like, you know, cashiering positions, security positions, things like that even under Dr. Volarich' (sic) restrictions that he would still be able to do." (England depo p30, 16-17)

Terry Cordray, vocational rehabilitation counselor, testified by deposition that prior to his 2009 injuries, Mr. Thilmony was able to perform medium work as a route driver for Schwan's Foods despite several preexisting medical problems, which Mr. Cordray described as a significant hindrance and obstacle to employment. However, after the 2009 injuries at Schwan's Foods, Mr. Thilmony was precluded from engaging in light work as the result of additional restrictions on Mr. Thilmony's ability to stand for more than 30 minutes and his inability to lift more than three pounds with the right arm away from the body and inability to engage in prolonged use of the right arm away from the body. Mr. Cordray testified that Mr. Thilmony is permanently and totally disabled as the result of the combination of his 2009 right knee and right shoulder injuries combined with his preexisting heart condition and his preexisting upper and lower extremity restrictions. Mr. Cordray referred to Mr. Thilmony's last day of work as "in July of 2011." (Cordray depo p25, 8)

RSMo Section 287.220. 2. All cases of permanent disability where there has been previous disability due to injuries occurring prior to January 1, 2014, shall be compensated as provided in this subsection. Compensation shall be computed on the basis of the average earnings at the time of the last injury. If any employee who has a preexisting permanent partial disability whether from compensable injury or otherwise, of such seriousness as to constitute a hindrance or obstacle to employment or to obtaining reemployment if the employee becomes unemployed, and the preexisting permanent partial disability, if a body as a whole injury, equals a minimum of fifty weeks of compensation or, if a major extremity injury only, equals a minimum of fifteen percent permanent partial disability, according to the medical standards that are used in determining such compensation, receives a subsequent compensable injury resulting in additional

permanent partial disability so that the degree or percentage of disability, in an amount equal to a minimum of fifty weeks compensation, if a body as a whole injury or, if a major extremity injury only, equals a minimum of fifteen percent permanent partial disability, caused by the combined disabilities is substantially greater than that which would have resulted from the last injury, considered alone and of itself, and if the employee is entitled to receive compensation on the basis of the combined disabilities, the employer at the time of the last injury shall be liable only for the degree or percentage of disability which would have resulted from the last injury had there been no preexisting disability. After the compensation liability of the employer for the last injury, considered alone, has been determined by an administrative law judge or the commission, the degree or percentage of employee's disability that is attributable to all injuries or conditions existing at the time the last injury was sustained shall then be determined by that administrative law judge or by the commission and the degree or percentage of disability which existed prior to the last injury plus the disability resulting from the last injury, if any, considered alone, shall be deducted from the combined disability, and compensation for the balance, if any, shall be paid out of a special fund known as the second injury fund, hereinafter provided for. If the previous disability or disabilities, whether from compensable injury or otherwise, and the last injury together result in total and permanent disability, the minimum standards under this subsection for a body as a whole injury or a major extremity injury shall not apply and the employer at the time of the last injury shall be liable only for the disability resulting from the last injury considered alone and of itself; except that if the compensation for which the employer at the time of the last injury is liable is less than the compensation provided in this chapter for permanent total disability, then in addition to the compensation for which the employer is liable and after the completion of payment of the compensation by the employer, the employee shall be paid the remainder of the compensation that would be due for permanent total disability under section 287.200 out of the second injury fund.

The claimant, Larry Thilmony has sustained his burden of proof that he is permanently and totally disabled as of July 1, 2015, as the result of his injuries sustained in his July 21, 2009 accident and his preexisting disabilities. Mr. Thilmony testified credibly with regard to his limitations as the result of his 2009 injuries in combination with his preexisting injuries. Moreover, Dr. Volarich and Terry Cordray testified credibly with regard to Mr. Thilmony's restrictions and his inability to continue to engage in gainful employment. In this case, Mr. Cordray's opinion with regard to Mr. Thilmony's vocational potential is given more weight than is that of Mr. England. With regard to the date of the inception of permanent total disability there is conflicting and troubling testimony with regard to the date of Mr. Thilmony's last date of employment at Schwan's Foods. There is, however, no doubt that after his last date of employment for Schwan's Foods, Mr. Thilmony was employed by his wife at her day care and was performing valuable services for which she would have had to hire a replacement employee should Mr. Thilmony have been unable to work in the day care. Mr. Thilmony testified that he worked in the day care until July of 2015 when the day care closed. Thus, July 1, 2015 is the date on which Mr. Thilmony is eligible to receive permanent total disability benefits from the Second Injury Fund. The mere fact that Mr. Thilmony continued to work at Schwan's Foods and then at

Employee: Larry Thilmony Injury No. 09-062797

the day care beyond his 2009 accident and injuries does not defeat Mr. Thilmony's claim for permanent and total disability benefits. Mr. Thilmony's work record is one of consistent hard work despite multiple physical and financial setbacks and his continued effort at employment beyond 2009 is a testament to his character rather than a reflection of his ability to be employed.

Made by:

HANNELORE D. FISCHER

Administrative Law Judge

Division of Workers' Compensation