Workers Compensation Vol. 61, No. 4 Spring Equal Exposure And the Compensability of Claims In Missouri Workers Compensation Law

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1 Workers Compensation Equal Exposure And the Compensability of Claims In Missouri Workers Compensation Law By B. Michael Korte and Christopher T. Archer The Tumultuous Recent Times of Missouri s Second Injury Fund: Practical Takeaways From the Legislation that Rescued the Fund From the Brink of Extinction By Rochelle L. Reeves Occupational Disease and the Missouri Mesothelioma Mess: Occupational Disease after Senate Bill 1 By James B. Kennedy 22 Procedures and Practices of the Missouri Division of Workers Compensation By Sally I. Heller Vol. 61, No. 4 Spring 2015

2 Famous and Infamous Lawyers in St. Louis History THE BOOK IS HERE! BAMSL has published a 140-page paperback 8 ½ x 11 book, a compilation of the history articles from the St. Louis Bar Journal written by Marshall Hier over the past 25 years. The articles include duels, disbarments, first lawyer in St. Louis, first black lawyer, lawyers before the Civil War, Unionists and Confederates during the Civil War, first woman lawyer in Missouri, attorneys for the owners of Dred Scott, members of Lincoln s cabinet, a United States Supreme Court Justice, first judge of the U.S. District Court for the Eastern District of Missouri, governors, senators, judges, mayors, corruption fighters Missouri Supreme Court judges, a founder of the American Bar Association and many others. MArshall Hier edited by john c. rasp The book is available at the Missouri History Museum shop, Left Bank Books (399 North Euclid, 63108), at the BAMSL headquarters (address below), on line by using this address: aspx?id= or by using the order form below. You may also order the book on line by using this link: Please mail a copy of the book entitled FamousandInfamousLawyersinSt.LouisLegalHistory to the following: Name: Address: Make your check payable to Bar Association of Metropolitan St. Louis and send it with this form to: BAMSL, 555 Washington Avenue, Suite 100, St. Louis, MO Or you may pay by credit card: Order online at: Number of books X $35.00 = (Price includes mailing and sales tax.) VISA / MasterCard / Discover (circle one) Credit Card Number Exp. Date CVV Name on card: same as above Billing Address: same as above

3 VOL. VOL SUMMER SUMMER NO. NO. 1 VOL. 61 SPRING 2015 NO. 4 ARTICLES ARTICLES ARTICLES Development Agreements in Missouri Essential Provisions and Differing Equal Development Exposure Agreements And the Compensability in Missouri Essential of Claims Provisions In Missouri and Differing Perspectives Workers Compensation Perspectives By Craig S. Biesterfeld Law and Missy McCoy...4 By By B. Craig Michael S. Biesterfeld Korte and and Christopher Missy McCoy T. Archer Real Estate Diligence in Merger and Acquisition Transactions The Real Tumultuous Estate Diligence Recent in Times Merger of and Missouri s Acquisition Second Transactions By Aaron L. Pawlitz...14 Injury By Aaron Fund: L. Practical Pawlitz Takeaways...14 From the Legislation that Rescued the The Green Movement Comes to Zoning in St. Louis The Fund Green From Movement the Brink Comes of Extinction to Zoning in St. Louis By William J. Kuehling and Zachary D. Wood...20 By Rochelle William L. J. Kuehling Reeves... and Zachary D. Wood Rebuilding Joplin: A Case Study on Public Private Partnership Occupational Rebuilding Joplin: Disease and Case the Study Missouri on Public Mesothelioma Private Partnership Mess: Occupational By Jennifer A. Marler...26 Disease By Jennifer after Senate A. Marler Bill Getting Getting By James Knowledgeable Knowledgeable B. Kennedy... About Power About Power 16 By Tracy Hunsaker Gilroy and Erin Petersen...32 Procedures By Tracy and Hunsaker Practices of Gilroy the Missouri and Erin Division Petersen of...32 Workers Compensation By Sally I. Heller FEATURES FEATURES The President s Page The The President s Page Page By Joseph A. Frank... 3 By By Joseph A. A. Frank History History 1949, The Bar s Missed Opportunity Poisonous 1949, The Bar s Atmosphere, Missed Opportunity By Marshall D. Hier... the Murder Trials of 38 George By Marshall Thompson D. Hier Part Books By Marshall in Brief Books in Brief D. Hier Books The Original in Brief RUSH LIMBAUGH: Lawyer, Legislator and Civil Libertarian The Original RUSH LIMBAUGH: Lawyer, Legislator and Civil Libertarian by GRAY Dennis MOUNTAIN K. Boman by Dennis K. Boman The By Flinch John Grisham Factor by Michael A. Kahn The Flinch Factor by Michael A. Kahn Reviewed by by Judge Arthur Litz Reviewed by Judge Arthur Litz The Brief Case The AND Brief Case JUSTICE FOR ALL By Charles A. Weiss A By History Charles of A. the Weiss Federal... District Court of Eastern Missouri 42 Tax Tax By Wise Wise Burton Boxerman Reviewed By Richard By Richard by M. M. Judge Wise Wise Arthur and Angela and Angela Litz... L. Schisler L. Schisler The Brief Case By Charles A. Weiss Tax Wise By Richard M. Wise and Angela L. Schisler Board of Editors Editor Board - John of Editors C. Rasp Editor Board - of John Editors C. Rasp Editor Charles - John A. C. Weiss Rasp Marshall D. Charles Hier A. Weiss Richard M. Wise Marshall D. Charles Hier A. Weiss Richard M. Wise Marshall D. The The Hier Hon. Arthur Hon. Arthur Richard Litz Litz M. Wise Copyright 2014 by The Bar Association of Copyright The 2014 Hon. by Arthur The Bar Litz Metropolitan St. Louis Association of Copyright Metropolitan 2014 by The Bar St. Louis Association of Metropolitan St. Louis BOARD OF GOVERNORS BOARD OF GOVERNORS President... Joseph A. Frank* President... Joseph A. Frank* President-Elect...Seth A. Albin* President-Elect...Seth A. Albin* Vice-President...Eric G. Kukowski* Vice-President...Eric G. Kukowski* Secretary... Jennifer L. Schwendemann* Secretary... Jennifer L. Schwendemann* Treasurer...Amy Collignon Gunn Treasurer...Amy Collignon Gunn Past President...Jon M. Baris* Past President...Jon M. Baris* Members-at-Large... Dawn M. Besserman Members-at-Large... Dawn M. Besserman...Kristine H. Bridges...Kristine H. Bridges...Kerry C. Feld...Kerry C. Feld...John J. Fischesser II...John J. Fischesser II... Annette P. Heller... Annette P. Heller...Carolyn M. Husmann...Carolyn M. Husmann... Matthew B. Leppert... Matthew B. Leppert...Jason M. Sengheiser...Jason M. Sengheiser...Scott A. Smith...Scott A. Smith...David R. Truman...David R. Truman ABA Delegate... Joan M. Swartz ABA Delegate... Joan M. Swartz Young Lawyers Division... Benjamin J. Hodges Young Lawyers Division... Benjamin J. Hodges Business Law... David L. Orwick Business Law... David L. Orwick Criminal Law...Anthony J. Muhlenkamp Criminal Law...Anthony J. Muhlenkamp Employee Benefits... Mary V. Khouri Employee Benefits... Mary V. Khouri Family & Juvenile Law... Cynthia Smuda Family & Juvenile Law... Cynthia Smuda Federal Litigation & Practice...Kurt J. Schafers Federal Litigation & Practice...Kurt J. Schafers...Douglas D. Churovich...Douglas D. Churovich Labor & Employment Law...Matthew J. Gierse, Labor & Employment Law...Matthew J. Gierse, Patent, Trademark & Copyright... Paul D. Tietz Patent, Trademark & Copyright... Paul D. Tietz Probate & Trust...Debbie J. Smiley Probate & Trust...Debbie J. Smiley Solo & Small Firm Practitioners...David T. Cox Solo & Small Firm Practitioners...David T. Cox Taxation... Sara G. Neill Taxation... Sara G. Neill Trial... Ian C. Simmons Trial... Ian C. Simmons Women in the Legal Profession Women in the Legal Profession...Jennifer A. Visintine...Jennifer A. Visintine Continuing Legal Education...Michael D. Cole Continuing Legal Education...Michael D. Cole Presidential Liaisons...Nicole Colbert-Botchway Presidential Liaisons...Nicole Colbert-Botchway Executive Director...Zoe W. Linza Executive Director...Zoe W. Linza *Executive Committee Members *Executive Committee Members The St. Louis Bar Journal (ISSN , USPS ) The published St. Louis quarterly Bar Journal for $12.00 (ISSN , per year for USPS members, subscriptions published quarterly for non-members for $12.00 not per available, year for by mem- The ) bers, Bar Association subscriptions of for Metropolitan non-members St. not Louis available, (BAMSL), by The 555 Bar Washington Association Avenue, of Metropolitan Suite 100, St. St. Louis, Louis MO (BAMSL), Washington ( ). Avenue, Periodicals Suite 100, postage St. Louis, paid MO at St. Louis, ( ). Missouri, Postmaster: Periodicals Send address postage changes paid at to: St. The Louis, St. Missouri, Louis Bar Postmaster: Journal c/o Send The Bar address Association changes of Metropolitan to: The St. Louis St. Louis, Bar Journal 555 Washington c/o The Bar Avenue, Association Suite of 100, Metropolitan St. Louis, St. MO Louis, Washington The opinions Avenue, expressed Suite herein 100, St. are Louis, those MO of the authors and The are opinions not necessarily expressed in herein conformity are those with of those the authors of the editor and or are with not those necessarily of The in Bar conformity Association with of those Metropolitan of the editor St. Louis. or with Direct those advertising of The Bar inquiries Association to Jennifer Mackie St. at Louis. (314) Direct advertising Acceptance inquiries of advertis- to Jen- of Metropolitan nifer ing does Mackie not at imply (314) endorsement of Acceptance products advertised of advertising listed does nor not of statements imply endorsement concerning of products them. advertised or or listed nor of statements concerning them. THE ST. LOUIS BAR JOURNAL/SUMMER THE ST. LOUIS BAR JOURNAL/SUMMER 2014 THE ST. LOUIS BAR JOURNAL/SPRING

4 2 THE ST. LOUIS BAR JOURNAL/SPRING 2015

5 The President s Report By Joseph A. Frank The legal profession is changing. This could have been the first line of the President s column in any issue of this publication in the last thirty years. The profession is always changing. Lawyers are resistant to change. Change happens anyway. Often, change is good. , efiling, online legal research, and the internet have all changed the profession for the better over the past twentyfive years. Even bigger changes are coming because the public does not want to access and pay for legal services in ways that we have been providing for the last one-hundred years. Online sites like legal document sites are pushing lawyers out of the document preparation business. A plug and paste form will most often not satisfy the needs of the potential client. However, many consumers are not willing to pay the fees charged by lawyers to prepare common legal documents. This change in consumer behavior is being felt in every area of practice. In some jurisdictions, up to 95% of family law cases have at least one party who is not represented by an attorney. Large corporate clients want more predictability in their legal fees and alternative billing practices. Virtual law firms where legal work is posted and freelance lawyers bid on the projects are also popping up. In twenty years, will law firms look like they do today? The trends suggest that they probably will not. New attorneys are entering a vastly different legal environment than existed even ten years ago. The recent American Bar Association report shows that only 57% of 2013 law school graduates were employed in long-term, full-time positions where bar passage was required. New lawyers are facing increased competition, fewer jobs, and mountains of educational debt. While this may sound like doom and gloom for the legal profession, these changes present great opportunities for change and growth in the way legal services are accessed and provided. Despite the surplus of attorneys, a significant percentage of legal needs go unmet. Legal help is too expensive for most low and middle income citizens. Bar associations are taking the lead on trying to match the under-employed lawyers with the unmet legal needs. Legal aid programs like Legal Services of Eastern Missouri do an amazing job of providing access to justice to thousands of low income people. In addition, individual attorneys and law firms provide an incredible number of pro bono legal work hours. However, too many find they cannot afford to hire a lawyer when faced with a legal problem. Some of the nation s top legal minds are working on solutions to these problems. The organized bar has shown that, while many middle income people cannot afford to hire a lawyer to handle their entire legal matter, many can afford to hire an attorney to handle part of their matter. This is the unbundling of legal services or limited scope representation. Limited scope representation has become a hot topic in the effort to address unmet legal needs. Missouri Rule of Professional Conduct 1.2 expressly permits limited scope representation with written consent. In addition, Rule 55.03, Mo. R. Prof. Con., allows a lawyer to: a) draft pleadings or motions for self represented litigants without signing the documents; b) enter a limited appearance and withdraw by filing a termination of limited appearance; and c) rely on a self-represented party s representation of facts when assisting with the drafting of legal documents. At least 41 states have rules allowing some form of limited scope representation. The younger generations do not want to purchase legal services the way our profession has traditionally offered those services. The younger generation of consumers grew up with itunes. The itunes generation does not pay close to ten dollars for an album that has only one song they want to hear when they can buy that one song for ninety-nine cents. They can also go online download it all in an instant. As a profession, are we still selling vinyl albums? Don t get me wrong, vinyl albums are great. However, if we live in the past the future will pass us by. In addition to being a very important tool in closing the gap between the unmet legal needs and under-employed attorneys in the profession, unbundling can also sell legal services, a la carte, to a generation of consumers used to buying goods and services that way. Thirty years from now I hope someone pulls out this issue of The St. Louis Bar Journal and reads my column and says That guy could not have been more wrong. Everything is exactly the same as it was thirty years ago. Unfortunately, change happens. Lawyers are smart, and resourceful. We solve problems. Whatever these changes bring, we will figure it out. q q q THE ST. LOUIS BAR JOURNAL/SPRING

6 Equal Exposure And the Compensability of Claims In Missouri Workers Compensation Law By B. Michael Korte and Christopher T. Archer The cardinal requirement of the Workers Compensation Law (hereinafter Law ) as to the compensability of any claim is that an employer is liable for the payment of benefits only if an injury or death results from an accident or from an exposure to an occupational disease which arises out of and in the course of an employee s employment. 1 The determination of which activities arise out of employment requires consideration as to whether there is, under all the circumstances, a reasonable relation between the event in question and the duties which an employer s employee has been hired to perform. 2 An employee s accident or exposure to occupational disease takes place in the course of the employee s employment when it occurs within the period of the employee s employment, at a place where the employee may reasonably be present and at a time that the employee is reasonably fulfilling the duties of the employee s employment. 3 As part of sweeping legislative changes in 2005, the Law s provisions as to which claims arise out of and in the course of employment were substantially amended. The pre- and post-2005 versions of portions of Mo. Rev. Stats. Section , noting deletions from the pre-2005 Law in brackets ( [ ] ) and the additions in boldface are: Sec (1) In this chapter the term injury is hereby defined to be an injury which has arisen out of and in the course of employment. [The injury must be incidental to and not independent of the relation of employer and employee. Ordinarily, gradual deterioration or progressive degeneration of the body cause by aging shall not be compensable, except where the deterioration or degeneration follows an incident of employment.] An injury by accident is comensable only if the accident was the prevailing factor in causing both the resulting medical condition and disability. The prevailing factor is defined to be the primary factor, in relation to any other factor, causing both the resulting medical condition and disability. (2) An injury shall be deemed to arise out of and in the course of employment only if: (a) It is reasonably apparent, upon consideration of all the circumstances, that the [employment] accident is [a substantial] the prevailing factor in causing the injury; and (b) [It can be seen to have followed as a natural incident of the work; and (c) It can be fairly traced to the employment as a proximate cause and (d)] It does not come from a hazard or risk unrelated to the employment to which workers would have been equally exposed outside of and unrelated to the employment in normal nonemployment life; (3) An injury resulting directly or indirectly from idiopathic causes is not compensable; (4) A cardiovascular, pulmonary, respiratory, or other disease, or cerebrovascular accident or myocardial infarction suffered by a worker is an injury only if the accident is the prevailing factor in causing the resulting medical condition. Sec : [Without otherwise affecting either the meaning or in- 1. Mo. Rev. Stats ; Wells v. Brown, 33 S.W.3d 190 (Mo. 2000); Kasl v. Bristol Care, Inc., 984 S.W.2d 852 (Mo. 1999); Drewes v. Trans World Airlines, Inc., 984 S.W.2d 512 (Mo. 1999); Abel v. Mike Russell s Standard Service, 924 S.W.2d 502 (Mo. 1996); Cox v. Tyson Foods, Inc., 920 S.W.2d 534 (Mo. 1996). 2. Arnold v. Wigdor Furniture Company, 281 S.W.2d 789 (Mo. 1955). 3. Abel v. Mike Russell s Standard Service, 924 S.W.2d 502 (Mo. 1996); Chambers v. SDX, Inc., 948 S.W.2d 448 (Mo. Ct. App., E.D. 1997); Hilton v. Pizza Hut, 892 S.W.2d 625 (Mo. Ct. App., W.D. 1994); Jordan v. Farmers State Bank, 791 S.W.2d 1 (Mo. Ct. App. 1990). B. Michael Korte is a fellow in the international College of Workers Compensation Lawyers, and is the 2009 recipient of the Distinguished Workers Compensation Lawyer award presented by the Bar Association of Metropolitan St. Louis. He has been recognized as one of the nation s Top 100 workers compensation attorneys by the Workers Injury Law and Advocacy Group. He is the author of Missouri Workers Compensation Law and Practice, and is a past president of the Missouri Association of Trial Attorneys. Mr. Korte earned B.S. and J.D. degrees from the University of Missouri Christopher T. Archer is a principle of Archer, Lassa and McHugh LLC which provides legal representation as well as education for employers, third party administrators, as well as insurers in the area of workers compensation. He is a contributing editor/author of the Missouri Bar s lawyer desk reference book on Missouri workers compensation, and for ten years has been the author and editor of the Missouri Bar s monthly Courts and CLE Bulletin summarizing workers compensation cases for attorneys statewide. He was an advising attorney for business lobbying groups in the drafting and editing of Senate Bill 1 and 130, signed into law by Governor Blunt in March, He was the recipient of the Distinguished Lawyer of the Year Award in 2012 as voted by Kids Chance of Missouri and the Bar Association of Metropolitan St Louis. 4 THE ST. LOUIS BAR JOURNAL/SPRING 2015

7 THE ST. LOUIS BAR JOURNAL/SPRING

8 terpretation of the abridged clause, personal injuries arising out of or in the course of such employment, it is hereby declared not to cover workers except while engaged in or about the premises where their duties are being performed, or where their services require their presence as part of such service.] Injuries sustained in company-owned or subsidized automobiles in accidents that occur while traveling from the employee s home to the employer s principal place of business or from the employer s principal place of business to the employee s home are not compensable. The extension of premises doctrine is abrogated to the extent it extends liability for accidents that occur on property not owned or controlled by the employer even if the accident occurs on customary, approved, permitted, usual or accepted routes used by the employee to get to and from their place of employment. Sec In applying the provisions of this chapter, it is the intent of the legislature to reject and abrogate earlier case law interpretations on the meaning of or definition of accident, occupational disease, arising out of, and in the course of the employment to include, but not be limited to, holdings in: Bennett v. Columbia Health Care and Rehabilitation, 80 S.W.3d 524 (Mo. App., W.D. 2002); Kasl v. Bristol Care, Inc., 984 S.W.2d 852 (Mo. banc 1999); and Drewes v. TWA, 984 S.W.2d 512 (Mo. banc 1999) and all cases citing, interpreting, applying, or following those cases. Various courts of appeals considered and construed these provisions before they first came to the attention of the Missouri Supreme Court in Miller Highway and Transportation Commission. 4 In Miller, the employee was walking briskly at work toward his truck when he felt a pop and his knee began to hurt. He testified that his work did not require him to walk in an unusually brisk way, that he normally walked briskly at home and did nothing different than usual when walking at work that day; that nothing about the road surface, his work clothes or the job caused any slip, strain or unusual movement. The Missouri Supreme Court affirmed the Missouri Labor and Industrial Relations Commission s (the Commission ) denial of compensation stating, in part: The meaning of [the Law s amended] provisions is unambiguous. An injury will not be deemed to arise out of employment if it merely happened to occur while working but work S.W.3d 671 (Mo. 2009) S.W.3d 671 at S.W.3d 189 (Mo. Ct. App., W.D. 2009) S.W.3d 463 (Mo. Ct. App., S.D. 2010) S.W.3d 463 at S.W.3d 770 (Mo. Ct. App., S.D. 2011) S.W.3d 70 (Mo. Ct. App., S.D. 2012) S.W.3d 504 (Mo. 2012). was not a prevailing factor and the risk involved here, walking, is one to which the worker would have been exposed equally in normal nonemployment life. The injury here did not occur because Mr. Miller fell due to some condition of his employment. He does not allege that his injuries were worsened due to some condition of his employment or due to being in an unsafe location due to his employment. He was walking on an even road surface when his knee happened to pop. Nothing about work caused it to do so. The injury arose during the course of employment, but did not arise out of employment. Under sections ,.3 and.10 as currently in force, that is insufficient.... Accordingly, the injury is not compensable, as there is no causal connection of the work activity to the injury other than the fact of its occurrence while at work. 5 Shortly thereafter, the Missouri Court of Appeals, Western District, decided Stricker v. Children s Hospital. 6 In Stricker, a registered nurse sustained an injury to her ankle in the parking garage of her employer caused by the heel of her work shoe. The employer argued that the employee was at no greater risk when she sustained her accident an injury. The court disagreed with this argument and awarded compensation, finding that the employee testified that she wore these shoes only at work and that the employer approved the work shoes. In Pile v. Lake Regional Health System, 7 the Missouri Court of Appeals, Southern District, reviewed the claim of a nursing supervisor who, while attending to a patient, moved quickly from the patient s room, turned the corner on the employer s carpeted hallway, and stumbled, sustaining fractures to her foot. The court reversed the Commission s denial of benefits, stating: Where the activity giving rise to the accident and injury is integral to the performance of a worker s job, the risk of the activity is related to employment. In such a case, there is a clear nexus between the work and the injury. Where the work nexus is clear, there is no need to consider whether the worker would have been equally exposed to the risk in normal non-employment life. 8 However, in Bailey v. Phelps County Reg. Med. Center, 9 the same district affirmed an award of the Commission which denied compensation regarding an injury to a nurse whose knee popped out of place while walking quickly at work, finding it neither arose out of nor in the scope of her employment. The following year, the Missouri Court of Appeals, Southern District, again took up the issue in Whiteley v. City of Poplar Bluff. 10 In Whiteley, a police officer was reaching in his patrol car to clean his windshield when he strained his neck. The court affirmed the Commission s award of benefits, citing Pile for support on the basis that compliance with an employer s written policy provided a clear nexus to the employee s work, without reference to the employee s equal exposure to the risk of injury in normal non-employment life. Perhaps, in part, due to the aftermath of the Pile decision, the Missouri Supreme Court revisited the issue in Johme v. St. John s Mercy Healthcare, 11 and reversed an award of compensation by the Commission. An employee who injured her ankle while making coffee at work failed to prove that her injuries arose out of her employment, since there was no evidence of any causal connection 6 THE ST. LOUIS BAR JOURNAL/SPRING 2015

9 between the source of the risk of the injury and any employment activity or condition of the employment, as opposed to a risk to which the employee was equally exposed in normal non-employment life, other than the fact of the occurrence of the injury while the employee was in the course of employment. The court thus implicitly overturned or abandoned the Pile precedent and the nexus test it had introduced. Since Johme, courts have applied the 2005 amendments more uniformly. In Duever v. All Outdoors, Inc., 12 and in Pope v. Gateway to the West Harley Davidson, 13 the Missouri Court of Appeals, Eastern District, weighted in on the issue. In Duever, an employee slipped and fell on ice on his employer s parking lot after conducting a safety meeting. The employer argued that the risk of falling on an icy parking lot was one to which the employee would have been equally exposed in nonemployment life. The court first distinguished Miller as not involving a condition of the premises that cause the injury stating... as a direct function of his employment..., Duever was in an unsafe location [and] sustained an injury due to an unsafe condition (the ice itself) over which he had no control. 14 It distinguished Johme on the same basis S.W.3d 863 (Mo. Ct. App., E.D. 2012) S.W.3d 315 (Mo. Ct. App., E.D. 2012) S.W.3d 863 at S.W.3d at S.W.3d at S.W.3d at S.W.3d 586 (Mo. Ct. App., S.D. 2014) S.W.3d at WD (Mo. Ct. App., W.D. 2014). 21. Scholastic, Inc., slip op. p. 5, citing Pope at S.W.3d 863 (Mo. Ct. App., E.D. 2012). 23. Scholastic, Inc., slip op. p.5. In Pope, an employee who was injured when he fell down stairs at work while wearing work boots and carrying a work-required helmet was injured... because he was at work, and not simply because [he] sustained an injury while at work according to the court, even though he wore work boots and would carry his motorcycle helmet outside of work, since there was no evidence that he normally carried his motorcycle helmet while descending stairs in his normal nonemployment life. The court seemed to have shifted the burden onto the employer on that issue:... unlike the facts in Johme, the record contains no evidence that Pope s boots contributed to or cause him to fall. In Johme, there was evidence that the shoes that the employee work both at work and outside of work were a cause of her fall. Unlike Johme, although Pope testified that he often wore his boots outside of work, the record lacks any evidence that Pope fell because of his boots. Moreover, the record contains no evidence that Pope normally carried his motorcycle helmet while descending stairs in his normal, non-employment life. Even if Pope were an avid motorcyclist, we will not presume facts not found in the record. Given the absence of such facts, we find little factual basis for the argument that Pope was equally exposed to the risk of walking down stairs while holding a motorcycle helmet in his normal, non-employment life. 16 The court recognized the abandonment of the Pile precedent implicit in the Johme decision in a footnore: In Johme, the Missouri Supreme Court indicated that the two-step Pile test is no longer the appropriate analysis for determining whether an injury arose out of and in the course of employment. 17 Recently, in Dorris v. Stoddard County, 18 the Missouri Court of Appeals, Southern District, revisited the issue. In Dorris, an employee was walking with her direct supervisor across a public street to review some new construction of a building built by the employer. The street had cracks in it and it was busy, so the employee was watching for traffic and was not looking down at the pavement when she tripped and fell, sustaining injuries to her shoulder. The court affirmed the Commission s award of compensation, rejecting the argument that the employee was equally exposed to the risk of her injury in her non-employment life. The court also affirmed the finding of the cause of the accident being made by circumstantial evidence. There is no requirement that Claimant must personally identify the specific cause of her fall; a reasonable inference regarding the cause was sufficient. 19 In Scholastic, Inc. v. Viley, 20 the employee was injured while leaving work when he slipped and fell in an icy parking lot subject to the control of the employer. The employer appealed the Commission s award of benefits, arguing that the employee faced an equal risk of injury walking across identical parking lots during his non-employment life. The court disagreed with the employer, citing the explanation in Pope that courts consider whether [the claimant] was injured because he was at work as opposed to becoming injured merely while he was at work. 21 As in Duever v. All Outdoors, Inc., 22 the court noted that the employee s injury was cause by an unsafe condition on the ground of the employer s worksite. 23 The court cautioned against a general identification of the hazard or risk in question, and, disregarding Hager v. Syberg s West- THE ST. LOUIS BAR JOURNAL/SPRING

10 port, 24 relied on the Dorriss court s explanation that the Duever court had implicitly determined that the non-employment hazard to be compared to the employment hazard which caused the employee s injury was the hazard at the particular location of the employee s injury, rather than any similar general hazard the employee might have encountered elsewhere in non-employment life. Conclusion Legislative amendments to the Worker s Compensation Law in 2005 regarding which claims arise out of and in the course of employment were intended to restrict injuries and accidents the Law considers to be compensable. Nevertheless, it is Section (2)(b), which was not changed in 2005, that has received the most attention by the courts. While the because at work and while at work dichotomy may seem difficult, at best, to discern, the claims of employees like those in Miller and Johme who are unable to identify any risk factor associated with their employment as the cause of their accidents will continue to be unlikely, at best, to succeed. As courts continue to explore the Law s equal exposure provisions, practitioners are well-advised to keep abreast of the evolving judicial trends and interpretation of what constitutes a compensable accident and injury under the Missouri Workers Compensation Law. q q q S.W.3d 771 (Mo. Ct. App., E.D. 2010). Hager was decided before Johme, Duever, and Dorriss, does not distinguish Miller, and does not examine whether the employee was exposed to the risk of that particular icy parking lot in his employment versus his non-employment life. Scholastic, Inc., slip op. p. 6, fn. 9. In Hager, the Missouri Court of Appeals, Eastern District, declined to extend an employer s premises to include the area of the parking lot where its employee fell and was injured after leaving work. Nationwide Deposition Services Court Reporting/Realtime Conference Room Scheduling Videography Advanced Deposition Services Desktop Video Conferencing Trial Services Exhibits Management Advanced Deposition Services Desktop Video Conferencing Trial Services Exhibits Management Nationwide Deposition Services Court Reporting/Realtime Skilled & Conference Room Scheduling Dedicated Team Videography Licensed & Professionals Committed to Your Success Focused on Your Needs Skilled & Dedicated Team Licensed & Sophisticated Web Tools MyCase Online Case Management Professionals Committed MyDocServe Docket and Service Lists to Your Success MyRecordsRetrieval Records Collection Focused on Your Needs Sophisticated Web Tools MyCase Online Case Management MyDocServe Docket and Service Lists MyRecordsRetrieval Records Collection THE ST. LOUIS BAR JOURNAL/SPRING 2015

11 Letter to the Editor John C. Rasp, Editor-in-Chief Richard A. Ahrens Melinda Bentley Michael Downey Richard C. Wuestling IV Bridget G. Hoy Alan Pratzel Jennifer L. Schwendeman Re: St. Louis Bar Journal, Winter 2015 Issue Volume 61, No. 3, Winter 2015 issue of the St. Louis Bar Journal was superb. I have heard many comments about the substantial value this material was for all lawyers. As you all know, few people who read an article compliment the author even though the content is helpful to them. So rest assured your valuable time and expertise was so appreciated without an express thanks. You people who make this fine contribution are the backbone of our system. My compliments. Congratulations and thanks for all that you do. Sincerely, Stephen N. Limbaugh, Sr. Here's the inaugural roster of BAMSL 100% Club member firms*. Each of these firms have distinguished themselves by having 100% of their St. Louis-based attorneys as BAMSL members. Congratulations and enjoy this prestigious status! Brown & Crouppen, P.C. Capes, Sokol, Goodman & Sarachan, P.C. Gray, Ritter & Graham, P.C. Lashly & Baer, P.C. Lewis, Rice & Fingersh, L.C. *These firms were 100% at the time we went to press. There is a possibility that other firms became eligible, but could not be included in this list after that. Ogletree, Deakins, Nash, Smoak & Stewart, P.C. Pedano, O Shea, McGavic & Hogenmiller, LLC Polster, Lieder, Woodruff & Lucchesi, L.C. Rosenblum Goldenhersh Schuchat Cook & Werner The Simon Law Firm, P.C. Senniger Powers LLP Sher Corwin Winters LLC Uthoff, Graeber, Bobinette & Blanke Weiss Attorneys at Law THE ST. LOUIS BAR JOURNAL/SPRING

12 The Tumultuous Recent Times of Missouri s Second Injury Fund: Practical Takeaways From the Legislation that Rescued the Fund From the Brink of Extinction By Rochelle L. Reeves In the Beginning: The Fund s Inception to Inauspicious Times Missouri s General Assembly in 1945 provided for the creation of the state s Second Injury Fund (the Fund ). 1 The purpose of the Fund is to assist individuals with disabilities by indirectly encouraging employers to hire and retain them. Theoretically, the Fund accomplishes this by limiting the workers compensation liability of an employer to disabilities obtained in its employment and by taking on liability for any additional disability resulting from the combination of an employee s pre-existing conditions and their subsequent work-related disability. Since 1949, Missouri s Fund statute has been codified at Missouri Revised Statutes, Section Among other elements, in order to recover from the Fund for enhanced permanent partial or permanent total disability, employees have to establish a pre-existing disability severe enough to satisfy the applicable statutory threshold and a subsequent work-related injury that qualifies for Missouri workers compensation benefits. Attorneys defending the Fund represent Missouri s Treasurer, who is the Fund s custodian. Any defense available to an employer can be asserted by the attorneys defending the Fund. 2 The Fund s money comes from employers, who pay a surcharge on their workers compensation insurance premiums (or estimated premiums for self-insured employers). From 1993 to 2005, the surcharge percentage was set by estimating the Fund s projected payout for the next calendar year and adjusting the new percentage accordingly to generate 110 percent of the projected payout that year, less any remaining moneys from the previous year. 3 During this time, the Fund s surcharge ranged from 0 to 4 percent. 4 By 2005, its reserve balance under this calculation ballooned to more than $33 million. That year, Missouri s General Assembly overhauled the state s Work- 1. Senate Bill 248, 1945 (Mo. Rev. Stats ). ers Compensation Law, including the Fund s surcharge calculation. 5 In addition to decreasing the liability of employers and, as a corollary, decreasing the Fund s liability, the new law required the Fund surcharge not to exceed three percent, implementing an artificial cap irrespective of the Fund s actual or projected liabilities. 6 As predicted, this disconnect between the Fund s surcharge rate and liabilities eviscerated its reserve balance, resulting in its insolvency. 7 By 2008, the Fund had $74 million in expenditures versus $56 million in 2. Liberty v. Treasurer, 218 S.W.3d 7, 14 (Mo. Ct. App. 2007) ( the Fund shall be entitled to all available defenses in all cases ). 3. Senate Bill 251, , 1993 Mo. Laws 791; see, e.g, Mo. Rev. Stat (1994), (2000). 4. See Mo. Dep t of Labor & Indus. Relations, What are the historical Second Injury Fund Surcharge (SIF), Workers Compensation Administrative Tax and Workers Compensation Administrative Surcharge rates?, available at: <https://molabor.uservoice. com/knowledgebase/articles/ what-are-the-historical-second-injuryfund-surchar>. 5. Senate Bill 130, 2005 Mo. Laws ; Senate Bill 130, , 2005 Mo. Laws Senate Bill 130, , 2005 Mo. Laws See Missouri State Auditor, Labor and Industrial Relations: Second Injury Fund, Report No (Apr. 2007) at 9-11, 15, available at <http://www.auditor.mo.gov/ press/ pdf>. Rochelle L. Reeves graduated from the University of Missouri-Columbia law and journalism schools. From , she served as Chief Counsel for the Labor Division in the Missouri Attorney General s Office, providing guidance to 30 attorneys statewide in defending more than 30,000 workers compensation claims against the State of Missouri and its Second Injury Fund. Previously, she worked as a state appellate and Missouri Supreme Court clerk and in private practice at Husch & Eppenberger, LLC. 10 THE ST. LOUIS BAR JOURNAL/SPRING 2015

13 THE ST. LOUIS BAR JOURNAL/WINTER

14 actual or projected liabilities. vi After several sessions without a legislative remedy for the Fund s predicted and then protracted insolvency, Missouri s General Assembly reached a compromise in the form of Senate Bill 1 (2013) ( SB1 ), 10 which took effect January 1, With respect to liabilities, SB1 adds two provisions to the Fund statute governing payouts. New subsection 15 establishes the following priority for paying Fund liabilities: (1) legal defense expenses; (2) permanent total disability awards; (3) permanent partial disability awards; (4) certain medical expenses for workers with uninsured employers; (5) interest on unpaid awards. Mo. Rev. Stat (Supp. 2013). New subsection 16 provides for post-award interest at the greater of five percent or the adjusted rate established by Missouri s Director of Revenue and used for calculating interest owed for certain tax refunds and deficiencies. Mo. Rev. Stat (Supp. 2013). Otherwise, SB1 primarily includes a two-pronged approach to return the Fund to solvency. First, it pro- As predicted, this disconnect between the Fund s surcharge rate and liabilities eviscerated revenue. In 2011, its obligations increased reserve balance, to $77 resulting million, in its its insolvency. revenue vii By Fund 2008, the by Fund means had $74 of a million supplemen- in vides additional revenue for the its decreased to $43 million, and it began to operate versus in $56 the million red. in revenue. In 2011, to its diminish obligations the increased Fund s to $77 liability million, by its tal surcharge. Second, it attempts expenditures decreasing the types of benefits for revenue A Fund decreased In Crisis: to $43 million, From and Black it began to operate in the red. which the Fund is liable, altering the to Red A Fund In Crisis: From Black to Red thresholds to qualify for the most The following data represent a costly remaining form of benefits, snapshot The following of the Second data represent Injury a snapshot Fund of the and Second prohibiting Injury Fund and as of June suspending 30 for each as of June 30 for each state fiscal state fiscal payment in certain circumstances. year 8 year viii from 2005 through from 2005 through State Fiscal Year Fund Balance Open Claims A A Fund Fund on on the the Mend: Mend: Fading Fading Back to Black A. Increased Revenue Back to Black Number of Unpaid Awards 2 Amount of Unpaid Awards 9 (initial payment only) 2005 $27,862,916 32,775 0 $ $33,599,056 32,069 0 $ $29,837,183 29,772 0 $ $19,866,107 27,667 0 $ $4,784,290 25,931 0 $ $4,966,165 26,931 0 $ $2,496,539 28, $4,586, $5,756,937 29, $18,067, $3,066,518 30,664 1,324 $31,873, $4,924,331 30,302 3,519 $51,289,606 In lieu of removing the three percent cap implemented in 2005, SB1 requires that the director of the division of workers compensation shall collect a supplemental surcharge not to exceed three percent. 12 Thus, the new law potentially doubles the Fund s income. 13 Notably, however, the supplemental surcharge expires on December 31, B. Procedural Changes As far as changing the day-to-day practice of Fund litigation, SB1 includes procedural and substantive changes. The procedural changes to are deceptively subtle on their face, with one phrase added in subsection 1 and one sentence deleted at the end of subsection 7. The additional phrase in subsection 1 grants the Fund a right it has never had historically, to require a workers compensation claimant to submit to reasonable medical examination at the Fund s request and expense if the employer has not obtained a medical examination report. 15 Thus, the Fund now has the express right in certain circumstances for an opportunity that has long been limited to the employer in 8. Missouri s State Fiscal Year runs from July 1 of the previous calendar year through June 30 of the fiscal year. For example, state fiscal year 2015 began July 1, 2014 and will end June 30, For permanent total disability awards, the payment ordered typically includes an initial payment amount representing arrearages for benefits that accrued prior to the award date and a weekly amount for ongoing payments following the award. For purposes of this table, the unpaid award column lists only the arrearage amount included in the unpaid awards and not any further arrearages that accrued from the award date until the Fund finally was able to pay overdue awards Mo. Laws SB 1 included several new provisions that do not directly affect the Fund, particularly several provisions addressing benefits for certain enumerated occupational diseases. SB1 also removed the division of workers compensation director from the retention process for the division s administrative law judges. 12. Mo. Rev. Stat (Supp. 2013). 13. Prior to SB1, the Fund statute required every three years an actuarial study... to determine the solvency of the fund, appropriate funding level of the fund, and forecasted expenditures from the fund. Mo. Rev. Stat (2000). SB1 requires a study every year and requires that the solvency determination include taking into consideration any existing balance carried forward from a previous year. Mo. Rev. Stat (Supp. 2013). 14. Mo. Rev. Stat (Supp. 2013) 15. Mo. Rev. Stat (Supp. 2013). The phrase medical examination report is not defined anywhere in Chapter 287, Missouri s Workers Compensation Law, although defines physician s report, medical report, and complete medical report. Id. at THE ST. LOUIS BAR JOURNAL/SPRING 2015

15 defending a claim: the right to hire its own medical expert to conduct an in-person independent medical examination of the claimant, write a report, and testify accordingly. Under the previous versions of the statute, the Fund was relegated either to relying on a report and testimony of a medical expert hired by the injured worker or the employer (both adverse parties to the Fund) or to hiring an expert to conduct a review of the worker s medical records and other related documentation 16 and give an opinion without personally examining the worker. By and large, these records reviews have not carried the day for the Fund in that the administrative law judges trying these claims have been reluctant to accept the report or testimony of a physician conducting a records review over that of a physician who personally examined the worker. The other procedural change in SB1 to was to remove the Fund from exclusion of the procedure in subsection 7 permitting admission of complete medical report[s] 17 without a deposition of the authoring physician. 18 In general, the provisions of subsection 7 permit a party at a workers compensation claim hearing that wishes to introduce the testimony of a treating or examining physician to submit that testimony in evidence on the issues in controversy by a complete medical report... without other foundational evidence subject to compliance with the requirements in subsection In order to gain admission into evidence of an expert physician s report without paying for the expert to testify via deposition or live at the hearing, the statute requires the proponent of that expert s testimony (1) to give other parties notice 60 days or greater in advance of the hearing that the party intends to submit 16. Other documentation provided to an expert conducting a records review for the Fund might include the injured worker s deposition testimony, a medical report from an expert who performed an independent medical examination for another party, or deposition testimony from a medical or other expert witness. 17. For purposes of Missouri s Workers Compensation Law, complete medical report means the report of a physician giving the physician s qualifications and the patient s history, complaints, details of the findings of any and all laboratory, X-ray and all other technical examinations, diagnosis, prognosis, nature of disability, if any, and an estimate of the percentage of permanent partial disability, if any. An element or elements of a complete medical report may be met by the physician s records. Mo. Rev. Stat (Supp. 2013). 18. Mo. Rev. Stat (Supp. 2013). 19. Id. 20. Id. 21. Id. 22. For example, in a claim for permanent partial disability when the Fund was excluded from subsection 7, the Fund might have agreed to waive its hearsay objection to the workers compensation claimant s expert physician s report in exchange for the claimant agreeing to accept a lesser percentage of disability or multiplicity factor to calculate the Fund s liability. This would decrease the Fund s liability while allowing the claimant to avoid paying to depose his or her expert physician to satisfy the foundational requirements for admitting the expert s opinion into evidence against the Fund. 23. Mo. Rev. Stat (2000). 24. See Mo. Rev. Stat (Supp. 2013). 25. See Mo. Rev. Stat (Supp. 2013). the expert s complete medical report into evidence at the hearing; (2) provide to the other parties, along with the notice, all the clinical and treatment records of the physician including copies of all records and reports received by the physician from other health care providers; and (3) make the physician available for cross-examination testimony by deposition not later than seven days before the matter is set for hearing. 20 If the proponent follows this procedure and another party decides to cross-examine the expert in question, each cross-examiner shall compensate the physician for the portion of the testimony obtained, and any testimony obtained by the proponent of the expert s testimony shall be at that party s expense on a proportional basis. 21 Exclusion from this subsection in the past meant a medical expert whose testimony was admitted at the hearing via this procedure was not admissible against the Fund without further evidentiary foundation. As such, before the exclusion was removed, the Fund was able to leverage the admission of the opposing party s expert s physician report in exchange for something advantageous to the Fund. 22 Now that the subsection applies to the Fund, it must decide whether to cross-examine an opponent s expert physician at its own expense once the opponent complies with the statutory procedure, thus incurring expenses it avoided prior to SB1. C. Substantive changes Prior to the January 1, 2014, effective date of SB1, the Fund provided the following types of benefits: physical rehabilitation benefits; 23 medical and death benefits for compensable injuries or death sustained by workers with employers who were required to have workers compensation insurance but did not; 24 wage loss benefits to replace lost income at a second employer when an injured worker could not work there as a result of a compensable injury sustained in their work for another employer; 25 and permanent partial and permanent total disability benefits. 26 THE ST. LOUIS BAR JOURNAL/SPRING

16 In contrast, for injuries occurring on or after its January 1, 2014, effective date, SB1 curtails the Fund s liability to benefits for physical rehabilitation and permanent total disability. 27 In addition to limiting the categories of benefits available from the Fund, SB1 dramatically alters the eligibility requirements for permanent total disability benefits from the Fund. For decades, injured workers rendered permanently and totally disabled 28 from the combination of their pre-existing disabilities and a subsequent compensable injury were able to recover from the Fund when the pre-existing disability merely constituted a hindrance or obstacle to employment or to obtaining reemployment should the worker become unemployed. 29 SB1 elevates the recovery threshold for Fund benefits, requiring a medically documented pre-existing permanent partial disability of 50 weeks 30 or greater resulting from active military duty in the United States armed forces; a compensable injury under the Workers Compensation Law; or disability to an extremity, loss of eyesight in one eye, or loss of hearing in one ear. 31 If the pre-existing disability is from the military or a compensable injury, the new statute merely requires that it combine with the subsequent compensable injury to result in permanent total disability. 32 Similarly, if the qualifying pre-existing disability is to an extremity or involves loss of eyesight or hearing and there is a subsequent compensable injury to the opposite extremity, eye, or ear that results in permanent total disability, the new statute merely requires that the combination render the worker permanently and totally disabled. 33 For a pre-existing disability that is 50 weeks or greater but does not fall within any of the preceding categories, a claimant who becomes permanently totally disabled upon sustaining a subsequent compensable injury can qualify for Fund benefits when such preexisting disability directly and significantly aggravates or accelerates the subsequent workrelated injury. 34 In addition, SB1 creates a special standard for individuals employed in qualifying sheltered workshops. For purposes of Fund liability, the medically documented 50-week threshold 35 does not apply. Instead, it suffices that a worker sustained a compensable injury while working for the sheltered workshop that combines their pre-existing disability to result in permanent total disability. 36 By curtailing the types of benefits available from the Fund and increasing the threshold to qualify for those benefits, the General Assembly intends to decrease the Fund s liability over time. Similarly, SB1 includes two other provisions aimed at decreasing Fund liability. 26. See Mo. Rev. Stat (Supp. 2013). SB1 added subsection 12 to the Fund statute to address attempts at forum shopping. This new subsection provides that [n]o compensation shall be payable from the Fund if an employee files a claim for compensation under the workers compensation law of another state with jurisdiction over the employee s injury or accident or occupational disease. 37 In the past, injured workers would select a forum with the most advantageous benefits provisions in their claims against employers and then seek to recover from Missouri s Fund. This was possible as long as Missouri had jurisdiction over the claim because a worker s claim against the Fund is treated as a separate lawsuit from the claim against their employer even though 27. See Mo. Rev. Stat (2000); ,.11,.3(1) (Supp. 2013). 28. In the context of Missouri workers compensation, the test for permanent total disability is whether the worker is able to compete in the open labor market.... The key question is whether any employer in the ordinary course of business would reasonably be expected to hire the worker in their current physical condition. Schussler v. Treasurer, 393 S.W.3d 90, 96 (Mo. Ct. App. 2012). A worker hirable even on a part-time basis is not considered permanently totally disabled. See Stewart v. Treasurer, 419 S.W.3d 915, (Mo. Ct. App. 2014). 29. See, e.g., Mo. Rev. Stat (1994), (2000) (Supp. 2012). 30. In order to determine the compensation owed for a permanent partial disability, Missouri s Workers Compensation Law sets forth a Schedule of Losses, which lists the maximum number of weeks assigned to different body parts. Mo. Rev. Stat (Supp. 2005). The percentage of disability as determined by the administrative law judge or agreed upon in settlement is multiplied by the total number of weeks the Schedule assigns to the whole body part to determine the weeks of compensation payable. Id. The number of weeks is then multiplied by the applicable rate of compensation to determine the benefit payable. Id.; see Mo. Dep t of Labor Chart No. 1, available at: <http://labor.mo.gov/sites/default/ files/pubs_forms/wc-110-ai.pdf> ( Visual chart showing number of weeks of compensation for scheduled and non-scheduled permanent partial disabilities. ) 31. Mo. Rev. Stat (1) (Supp. 2013). 32. Id. 33. Id. 34. Id. 35. Mo. Rev. Stat (1)(a) (Supp. 2013). 36. Mo. Rev. Stat (1)(b) (Supp. 2013). 37. Mo. Rev. Stat (Supp. 2013). 14 THE ST. LOUIS BAR JOURNAL/SPRING 2015

17 establishing a right to relief against the Fund requires proof of a compensable injury. 38 For injuries on or after January 1, 2014, simply filing a workers compensation claim in another jurisdiction will preclude payment of Fund benefits. Another new subsection in SB1 allows suspension of permanent total disability benefits from the Fund in certain circumstances. 39 Subsection 13 of the Fund statute provides that life payments to an injured employee made from the fund shall be suspended when the employee is able to obtain suitable gainful employment or be self-employed in view of the nature and severity of the injury. 40 The statute requires the division of workers compensation to promulgate rules setting forth a reasonable standard means test to determine if such employment warrants the suspension of benefits. 41 Looking into the Fund s Future Without the advantage of a working crystal ball, the Fund s financial future and its potential longevity remain a mystery. Who can accurately predict its financial situation or Missouri s sociopolitical climate in 2021 when the supplemental surcharge sunsets? For now, the workers compensation bar, particularly the Fund s attorneys, will spend the next several years parsing the terms of SB1 and its intended and, inevitably, unintended consequences. q q q 38. See 8 CSR (7)(B) ( A claim against an employer/insurer and the... Fund are against two (2) separate parties and the assertion of a claim against one is not an assertion of a claim against the other. ). See also, e.g., Seifner v. Treasurer, 362 S.W.3d 59, 63 (Mo. Ct. App. 2012) (settlement with employer did not collaterally estop Fund from defending against claim); Nance v. Treasurer, 85 S.W.3d 767, 771 (Mo. Ct. App. 2002) (claimant who dismissed claim against employer could still pursue Fund benefits). 39. The Workers Compensation Law provides more generally that [u]pon its own motion or upon the application of any party in interest on the ground of a change in condition, the [labor and industrial relations] commission may... upon a rehearing... review any award and... make an award ending, diminishing or increasing the compensation previously awarded.... Mo. Rev. Stat (2000). However, has been held to require a demonstration of a change in a claimant s physical condition before the commission could change that claimant s award. Pavia v. Smitty s Supermarket, 366 S.W.3d 542, 549 (Mo. Ct. App. 2012). 40. Mo. Rev. Stat (Supp. 2013). 41. Id. To date, the division has not promulgated such a rule. THE ST. LOUIS BAR JOURNAL/SPRING

18 Occupational Disease and the Missouri Mesothelioma Mess: Occupational Disease after Senate Bill 1 By James B. Kennedy Senate Bill 1 1, which became effective January 1, 2014, made significant changes to the Missouri Workers Compensation Law. Among those changes are a number which involve how certain occupational diseases are now to be compensated. The legislative history of these amendments is obscure but it can safely be said that they were the spawn of the more far-reaching changes that took place in 2005 and are the consequences of those earlier reforms. 2 The Story Began in 2005 Effective August 28, 2005 the Missouri General Assembly passed sweeping changes to Mo. Rev. Stat. Chapter et. seq, (the Missouri Workers Compensation Law). 3 One of the most notable amendments was the repeal of the long-standing rule of liberal construction, historically codified in Section That rule had long been a thorn in the side of industry and even though the rule had never been found to be, standing alone, a sufficient basis for an award in the employee s favor, it was most often just the coup de grace which sealed the employer s fate. 4 Consequently, in 2005 Section was amended to read: Administrative law judges, legal advisors, the labor and industrial relations commission, the division of workers compensation, and any reviewing courts shall construe the provisions of this chapter strictly. In addition, Section , which sets forth the burdens of proof to be applied in workers compensation cases, was amended by adding a provision which states: In asserting any claim or defense based on a factual proposition, the party asserting such claim or defense must establish that such proposition is more likely to be true than not true. The intent of such amendments was to level the playing field and was in response to a long line of decisions which tilted the playing field, in industry s view, too far in favor of the claimant. 5 Although industry undoubtedly saw the passage of the 2005 amendments as a major victory, developments were to follow which demonstrated, at least in part, the sometimes truth of the observation that one must be careful for what one wishes for (for fear that they may receive it). 1. L. 2013, S. B. 1, Section A, eff. Jan After the 2005 amendments survived a general legal challenge in Alliance for Retired Americans v. Dep t of Labor & Indus. Relations 6, individual sections of the new law were tested with varying results. That is, although many claims were denied under the law due to, say, the lack of the occurrence of an accident as that element is now defined, or due to the claimant s failure to prove their employment involved a greater hazard of a particular consequence than the hazard they encounter in nonemployment life (among other de- 2. The use of quotation marks is to acknowledge that in the industry vs. labor dichotomy, one stakeholder s reforms are another stakeholder s step back in the direction of industrial exploitation. 3. Hereafter, all statutory references to Chapter 287 will only cite the section and subsection numbers. 4. References to the employer are intended to also refer to the employer s insurer, except where a distinction between the two entities must be made, such as where their liability and interests are not co-extensive. 5. Claimant is a term used in workers compensation to refer to either the injured employee or to a dependent of an employee who has filed a formal claim for compensation after the injured employee s death. 6. See Alliance for Retired Americans, 277 S.W.3d 670 (Mo. en banc 2009). The Missouri Supreme Court rejected most of the plaintiffs theories due to the lack of ripeness but did rule that to the extent that an injured employee is unable to collect workers compensation benefits due to the new narrower interpretation of what constitutes a compensable accidental injury under the 2005 amendments, that such an employee does have the right to file a civil suit against the employer for negligence. James B. Kennedy is a member at Evans & Dixon, LLC and is in the firm s St. Louis office. He is a graduate of the University of Missouri Columbia (B. A. 1966, J. D. 1969) and is licensed in Missouri and Illinois. He has specialized in the defense of workers compensation cases throughout his career, writes and speaks regularly on workers compensation topics and is the long-standing author of Chapter 4 in the Missouri Bar s Workers Compensation deskbook. 16 THE ST. LOUIS BAR JOURNAL/SPRING 2015

19 THE ST. LOUIS BAR JOURNAL/SPRING

20 fenses), things did not always go well for the defense, and that is where we encounter the dreaded law of unintended consequences. It seems then that the law of strict construction is a double-edged sword. The Stage is Set What some proponents of the 2005 amendments may have failed to appreciate is that strict construction can have the effect of not only abrogating unfavorable past case law, but can also be applied to past cases which ruled in favor of industry when those decisions are reconsidered in the light of strict construction. One such case was Robinson v. Hooker, which held that due to strict construction, the doctrine of exclusivity can no longer be extended to protect a co-employee from civil suits based upon their negligence in causing injury to a co-worker plaintiff. 7 After all, the exclusivity protection afforded to co-employees since a 1982 decision 8 was a judicial construct, not protection afforded by the express term of Section That statute limits the employer s liability for work-related injuries to the remedies specified in the workers compensation law, but says nothing about limiting the extent of a co-worker s liability for causing an injury at work to a co-employee. Both Fish and Fowl former job caused his disease. The employer pleaded exclusivity as a defense but the court ruled that since the exclusivity protection afforded by Section and.2 refer only refer to personal injury or death due to an accident, and since the references to occupational disease that were contained in the pre-2005 version of those sections were removed in 2005, that due to strict construction, that exclusivity protection cannot be used as a defense to a civil action based upon the occurrence of an occupational disease. The court did not, however, go as far as finding that the workers compensation law no longer covered occupational disease at all, but held, in effect, that where an employee s injury was caused by an occupational disease, the employee could pursue either remedy. Thus, after State ex rel. KCP & L, an occupational disease was potentially either a workers compensation claim or a civil suit, at the employee s option. The Genesis of Senate Bill 1 Industry was not pleased with the outcome in State ex rel. KCP & L. Although some employees might well look only to the workers compensation law where an occupational disease, such as a repetitive motion injury like carpal tunnel syndrome 10 had been contracted, in toxic exposure cases the clear choice would be a negligence action due to the absence of the limitations on damages which is at the heart of Missouri s workers compensation law. 11 This additional and unexpected civil exposure needed, in industry s view, to be addressed. This was accomplished during the 2013 legislative session when, as the legislative clock ticked down, Senate Bill 1 was passed. Senate Bill 1 restored the occupational disease language to Sec by adding the phrase or occupational disease after the phrase by accident, and restored the reference to occupational disease in Section , the exclusivity provision. 12 However, it is now generally agreed the cost to industry was high and that is where the new occupational disease provisions of Senate Bill 1 enter our story. There Are Now Three Categories of Occupation Diseases 13 Category One: this category includes every occupational disease which has ever been recognized, or which might in the future be recognized, either statutorily or judicially, as an occupational disease, except for those in categories two and three. That is, Missouri workers compensation law has long recognized that exposure to any number of toxic chemicals or infectious diseases can form the basis for an award of compensation, as can exposure to repetitive motion or repetitive trauma. 14 Chapter 287 contains multiple sections which refer to occupational disease, among them Sections , , and Since Missouri adopted the occupational disease law in 1931, few attorneys, if any, questioned whether an employee who contracted an occupational disease had a remedy other than filing a claim for compensation under Chapter 287. But then the adoption of the rule of strict construction occurred and State ex rel. KCP & L Greater Missouri Operations Company v. Cook was decided. 9 That case involved an employee who worked for the employer for 34 years and who, after his retirement, was diagnosed with mesothelioma. He filed a civil suit, alleging his exposure to asbestos containing materials at his 7. See Robinson v. Hooker, 323 S. W.3d 418 (Mo. Ct. App. 2010). 8. See State ex rel. Badami v. Gaertner, 630 S.W.2d 175 (Mo. Ct. App. 1982). 9. See State ex rel. KCP & L., 353 S.W.3d 14 (Mo. Ct. App. 2011). 10. The greater certainty of recovery, but likely a smaller recovery, under the workers compensation law must be balanced against the need to prove negligence in a civil suit in order to gain a larger settlement or judgment. 11. This is a characteristic of all workers compensation laws. 12. And the limitation on the liability of co-employees was made statutory in so they are again protected unless the injury was the result of... an affirmative negligent act that purposefully and dangerously caused or increased the risk of injury. 13. These are the author s categories, not categories that are enumerated as such in Chapter See , THE ST. LOUIS BAR JOURNAL/SPRING 2015

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