Workers’ Compensation: A Recent Louisiana Decision Revisits a Fundamental Issue

A worker’s benefits may be forfeited if the employee is untruthful on a medical questionnaire (if the misrepresentations directly relate to the alleged injury) or prejudices the employer’s ability to recovery from the “Louisiana Second Injury Fund.” La. R.S. 23:1208.1 Some Louisiana courts have shown reluctance to deny workers’ compensation benefits based on the employee’s alleged failure to truthfully answer a medical history questionnaire. However, the court in Spillman v. Career Adventures, Inc., --- So.3d ---- 2021 (La. App. 2d Cir. 8/11/21), 2021 WL 3523959, held that benefits were forfeited because the claimant provided false responses to several medical history questions and failed to answer a number of specific questions on a post-hire medical history questionnaire provided by his employer.

At trial, it was established that Spillman had pre-incident medical conditions to include: 1) injuries related to a 2007 work-related accident; 2) regional sympathetic dystrophy of the left foot; 3) COPD; 4) chronic pain from a gunshot wound in his left leg; 5) surgery to the AC joint of his right shoulder; 6) injuries from a 2018 motor vehicle accident to the right shoulder and right knee; 7) anxiety; 8) bipolar disorder; and 9) many other ailments.

Like many other employers, Spillman’s employer Career Adventures included with its employment packet a “Office of Workers’ Compensation Second Injury Board Questionnaire.” Spillman failed to truthfully complete this questionnaire and checked “no” to specific questions which asked if he had experienced many of his known conditions such as COPD and bipolar disorder. Although Spillman took the time to respond to numerous “fill in the blank” questions, he purposefully skipped at least 10 inquiries.

Eleven months after hire, Spillman alleged he was injured at work while performing his duties as a welder. At trial, Spillman’s family physician identified a torn tendon in the left elbow as a work-related injury. He further testified that the tendon injury limited his activities and merged with his pre-existing injuries to create a greater total disability. The workers’ compensation judge (“WCJ”) ruled that Spillman violated La. 23:1208.1 by failing to truthfully answer certain questions. The Second Circuit “went further” in affirming the workers’ compensation judge, stating:

“We go further than the WCJ. All information which would have been disclosed had Mr. Spillman truthfully answered each and every question on the preemployment questionnaire must be considered …”

Therefore, the appellate court in Spillman found that both false answers and a failure to answer certain questions can qualify as a willful misrepresentation sufficient to cause a forfeiture of benefits under La. R.S. 23:1208.1 under certain circumstances.

In a case handled by Keogh Cox lawyers Steve Whitlow and Jenny McLin, a Louisiana court of appeal has affirmed the ruling of a Workers Compensation Judge holding that an employee who made misrepresentations about his claim forfeited his right to workers compensation benefits. Arguello v. Brand Energy, 13-CA-990 (La. App. 5th Cir. 5/21/14), ___ So. 3rd ___.

In ruling for the employer, the trial court found that the claimant had committed three separate violations of La.R.S. 23:1208. The claimant was also assessed with a $500 civil penalty payable to the Kids Chance Scholarship Program.

When an employee is injured on the job and the employee’s request for workers’ compensation benefits is disputed, La. R.S. 23:1201.1 allows an employer to request a preliminary determination hearing (“PDH”) with the Office of Workers’ Compensation (“OWC”). If the workers’ compensation judge rules at the PDH that benefits are owed, the employer has ten days to comply with the judge’s ruling. The First Circuit recently ruled that an employer can find “safe harbor” if it technically complies with the rigorous deadlines of the statute, which if missed can have profound consequences, subjecting the employer to penalties and attorney fees.

In Kilbourne v. Dixon Correctional Institute, the court recently affirmed a ruling that found an employer complied with La. R.S. 23:1201.1 and could not be subject to penalties or attorney’s fees when it mailed the disputed workers compensation benefits within ten days of the judge’s ruling at the PDH. The ruling was affirmed even though the employee did not receive payment within ten days of the hearing.

The employer in Kilbourne stopped issuing weekly workers compensation benefits after two doctors found the claimant’s ongoing complaints were unrelated to the work accident and the claimant could return to full duty work. The employee then filed a disputed claim with the OWC and requested reinstatement of his benefits. He also requested an award of penalties and attorney’s fees because he claimed the employer’s suspension of indemnity benefits was arbitrary and capricious. The employer requested a PDH to address these issues.

The OWC judge issued a preliminary determination that although the employee was owed supplemental benefits from the date his payments of benefits stopped, the employer was not arbitrary and capricious in its decision to stop payment. Within ten days of the mailing of the PDH ruling, the employer issued and mailed benefit checks to the employee and filed a form with the OWC to provide notice the employer was paying the benefits. Nevertheless, the employee disagreed with the PDH ruling and the matter went to trial.

At trial, the employee argued that he should have received penalties, attorney fees, and interest on the back benefits paid after the PDH ruling. The employee argued the employer failed to comply with section 1201.1 because he did not receive the indemnity benefits until more than ten days after the PDH ruling. However, evidence showed the benefit payments were postmarked and mailed within ten days of the receipt of PDH ruling.

Accordingly, the trial court found that the employer was immune from an award of penalties and attorney fees pursuant to the “safe harbor” provision of section 1201.1. Interest also could not be owed on back pay when the employer complied with the statute. The First Circuit affirmed this decision on appeal. Although providing the claimant funds within 10 days of the PDH ruling remains the best practice for an employer, this ruling informs employers that they should find safe harbor from what could be significant penalties and attorney’s fees if they meet the technical requirements of the statute and mail their compliance with the judge’s ruling within ten days of the PDH.

Case Reference: Kilbourne v. Dixon Correctional Institute, 2022-0455,(La. App. 1 Cir. 11/4/22) ____So. 3d ___,2022 WL 16706951.