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Sulkosky v. Morrison-Knudsen (6/28/96), 919 P 2d 158
<![CDATA[
NOTICE: This opinion is subject to formal correction before
publication in the Pacific Reporter. Readers are requested to bring
errors to the attention of the Clerk of the Appellate Courts, 303 K
Street, Anchorage, Alaska 99501.
THE SUPREME COURT OF THE STATE OF ALASKA
EUGENE SULKOSKY, )
) Supreme Court No. S-6317
Appellant, )
) Superior Court No.
v. ) 1JU-93-26 CI
)
MORRISON-KNUDSEN, AND AETNA ) O P I N I O N
CASUALTY & SURETY CO., )
) [No. 4363 - June 28, 1996]
Appellees. )
______________________________)
Appeal from the Superior Court of the State of
Alaska, First Judicial District, Ketchikan,
Thomas M. Jahnke, Judge.
Appearances: Paul M. Hoffman, Robertson,
Monagle & Eastaugh, Juneau, for Appellant.
Michael A. Barcott, Faulkner, Banfield, Doogan
& Holmes, Seattle, Washington, for Appellees.
Before: Compton, Chief Justice, Rabinowitz,
Matthews and Eastaugh, Justices and Carpeneti,
Justice pro tem.
PER CURIAM.
Eugene Sulkosky appeals from the superior court's
affirmance of the Workers' Compensation Board's order modifying his
status from that of permanent total disability to permanent partial
disability and denying his request for attorney's fees. On the
basis of our review of the record, we conclude that the Superior
Court's affirmance of the Board's decision should be affirmed. In
reaching this conclusion we are in agreement with, and adopt, the
opinion entered in this case by Thomas M. Jahnke, Superior Court
Judge. Judge Jahnke's opinion is appended, having been edited in
conformance with Supreme Court procedural standards. (EN1)
We note that in addition to those issues ordered remanded
by the superior court to the Board, certain other issues remain
unresolved. In this regard the Board in its January 3, 1993 order
stated in part:
In Sulkosky I we declined to determine if the
positions of rate clerk and dispatcher
constituted suitable gainful employment.
Employee submitted evidence and argued that he
is still unable to perform those jobs and that
they do not constitute suitable gainful
employment. That issue was not scheduled for
consideration at the recent hearing and
Petitioners did not submit any evidence on the
subject. Although that issue, and others, may
still need to be resolved, we decline to do so
at this time.
(Footnotes omitted.)
The judgment of the superior court is AFFIRMED. The case
is REMANDED to the superior court with directions to REMAND to the
Board for such further proceedings as are deemed necessary to
resolve all remaining issues. (EN2)
ENDNOTES:
1. Subsections II.E., H., I., and J. of Judge Jahnke's opinion
are not reproduced since they have not been put in issue by
Sulkosky in his appeal to this court.
2. On remand to the Board, the question of Sulkosky's eligibility
for rehabilitation benefits and whether he is other than an odd lot
employee and thus is now permanently totally disabled should be
addressed. As to this question, the Board previously found in
part:
Based on the surveillance evidence and Dr.
Miskovsky's testimony, we find Employee is
able to work for eight hours per day, 40 hours
per week in a sedentary job.
This factual determination should be considered open for further
review in the proceedings on remand.
 IN THE SUPERIOR COURT FOR THE STATE OF ALASKA
FIRST JUDICIAL DISTRICT AT JUNEAU
EUGENE SULKOSKY, )
)
Appellant, )
v. )
)
MORRISON-KNUDSEN ENGINEERS, )
INC., and AETNA CASUALTY & )
SURETY COMPANY, and ALASKA )
WORKERS' COMPENSATION BOARD, )
)
Appellees. )
)
______________________________) No. 1JU-93-26 CI
MEMORANDUM OF DECISION AND ORDER
I. INTRODUCTION
This is an appeal from a decision of the Alaska Workers'
Compensation Board ("the Board"). Eugene Sulkosky, formerly a
heavy equipment operator for Morrison-Knudsen Engineers, Inc.,
injured his lower back twice in the mid-1970s and again in October
1982 while working in Prudhoe Bay. Years of litigation ensued. In
1988, the Board determined that Sulkosky was an "odd lot"employee
and was permanently totally disabled. (EN1) This determination was
affirmed by the supreme court in 1991.
In late 1990, Aetna Casualty & Surety Company ("Aetna"),
Morrison-Knudsen's workers' compensation insurance carrier,
petitioned the Board to modify its 1988 decision on the ground that
it had conducted surveillance of Sulkosky in mid-1990 and acquired
videotape and photographic evidence which tended to show that he
was not, in fact, totally disabled. After further disputes,
primarily over discovery and depositions, a hearing before the
Board took place in November 1992.
In January 1993, the Board issued a Decision and Order
containing extensive findings of fact and conclusions of law. In
brief, the Board saw
videotape and photographic evidence of
[Sulkosky's] activities in April, July and
October 1990. This evidence show[ed]
[Sulkosky] raking piles of debris in his yard;
operating a rototiller; driving; twisting;
pushing; pulling; bending at the waist;
squatting; reaching overhead; bending at the
waist while cranking a jack on his
recreational vehicle; splitting a log for fire
wood; walking on uneven ground without a cane;
rowing a boat; and with assistance, lifting
and pushing two boats (a 12 foot aluminum
skiff and a small fiberglass boat) to the tops
of trucks.
Based on this evidence and the testimony of witnesses, the Board
found that:
- Sulkosky is "not a credible witness";
- Sulkosky "exaggerated the extent of his physical limitations
when describing his condition to his treating physicians and
in his testimony before [the Board]";
- the "conclusion in Sulkosky I, that [Sulkosky] was entitled
to [permanent total disability] compensation,"was based in
part on its "observations of [Sulkosky] at the April 1988
hearing,"and those "observations were based on [Sulkosky's]
exaggeration of the severity of his condition";
- Sulkosky "uses his cane as a 'prop' to enhance the
appearance of disability";
- "the reports from [Sulkosky's] treating physicians about his
physical capabilities have been tainted by the incorrect
information [Sulkosky] provided to them";
- Sulkosky "is not totally disabled"and "is capable of
working full time at a sedentary job if he wished to do so,"
and is therefore "not an 'odd lot' employee"and "no longer
entitled to [permanent total disability] compensation."
Having found Sulkosky ineligible for permanent total disability
compensation, the Board found that he was, instead, entitled to
permanent partial disability compensation pursuant to AS
23.30.190)a)(20), as that statute read at the time of his injury.
The Board also made several other rulings which are
disputed on appeal. First, Aetna was found not responsible for the
payment of certain of Sulkosky's medical bills and the associated
travel costs because the doctor providing the care (Dr. Brack) had
not filed medical reports in accordance with Board regulations.
Second, because Sulkosky had prevailed in an
interlocutory dispute over the release to him of Aetna's
surveillance tapes but had not prevailed on the ultimate issue in
this proceeding, i.e., his continued entitlement to permanent total
disability compensation, he was entitled to payment by Aetna of
only his legal costs relating to that discovery dispute. The
(considerably greater) attorney fees owed by Sulkosky to his
attorney, Paul Hoffman, for work done in connection with that
discovery dispute were to be paid by Aetna out of Sulkosky's
compensation (and thus, in effect, by Sulkosky himself).
Third, because Aetna, in an interlocutory dispute, won an
order from the Board compelling Sulkosky to attend a deposition and
answer Aetna's questions, Sulkosky was held not entitled to be paid
for his attorney's services relating to that issue.
Finally, because the Board ruled against Sulkosky on the
ultimate issue of his continued entitlement to permanent total
disability compensation, his claims for additional attorney's fees
and costs were denied.
Sulkosky now appeals on a variety of grounds.
II. ANALYSIS
Because the injury occurred in October 1982, a number of
the issues in this case must be decided according to the workers'
compensation statute in effect at the time. The statute was
revised and substantially altered in 1988.
A. Modification Jurisdiction
Sulkosky begins by making an essentially jurisdictional
argument. The relevant statute provides that
[u]pon its own initiative, or upon the
application of any party in interest on the
ground of a change in conditions . . . or
because of a mistake in its determination of a
fact, the board may . . . review a
compensation case . . . . [T]he board may
issue a new compensation order which
terminates, continues, reinstates, increases,
or decreases the compensation, or award
compensation.
AS 23.30.130(a). Under this statute, the Board "is granted broad
discretion to modify its prior decisions and findings"and may
modify its prior factual findings if it finds they are mistaken.
Dresser Industries, Inc./Atlas Div. v. Hiestand, 702 P.2d 244, 247-
48 (Alaska 1985) (citing Interior Paint Co. v. Rodgers, 522 P.2d
164, 168 (Alaska 1974)); see also Hulsey v. Johnson & Holen, 814
P.2d 327, 328 (Alaska 1991) (proceeding under this statute "invokes
the Board's jurisdiction over the original claim").
Sulkosky, however, claims that because the supreme court,
in 1991, affirmed the Board's 1988 decision that he was permanently
totally disabled, "the Board should have no authority to reconsider
[the 1988 decision]." In support of this assertion he cites Vetter
v. Wagner, 576 P.2d 979 (Alaska 1979), a workers' compensation case
which stands, in relevant part, for the unremarkable preposition
that when a case is remanded, the lower court (or agency) is bound
by the appellate court's rulings and can do nothing contrary to
that court's disposition of the case. Vetter, however, is
inapposite, for it dealt with reconsideration by the Board, on
remand, of a substantial evidence question expressly and finally
resolved as a matter of law by the supreme court in the initial
appeal of the case. In this case, by contrast, no remand is
involved. Rather, the Board reconsidered and modified its previous
order pursuant to express statutory authorization to do so, based
on evidence that did not exist when the Board and the supreme court
considered Sulkosky I in 1988 and 1991. The order is not rendered
immune from modification simply because it was earlier affirmed on
appeal.
The essence of Sulkosky's argument is that these matters
are res judicata. As his counsel stated at the November 1992
hearing, "we believe the board does not have jurisdiction to
reconsider the classification of permanent and total disability
because it's been affirmed all the way through the courts and back
down." Transcript of Hearing, at 25 (opening statement of Paul
Hoffman). This contention was addressed before statehood by Judge
Folta, who explained that
although the question of res judicata may lurk
in the background, it is not involved in this
proceeding, because if the power to rehear
exists, the doctrine of res judicata is
inapplicable and likewise, if the power does
not exist, no occasion arises for invoking it.
The case turns, therefore, on the question
whether the Alaska Industrial Board has the
power to grant a rehearing and set aside or
modify its awards.
Suryan v. Alaska Indus. Bd., 12 Alaska 571, 573 (D. Alaska 1950);
see also Fischback & Moore of Alaska, Inc. v. Lynn, 453 P.2d 478,
483-84 (Alaska 1969). In Suryan, the court noted that, as a
general matter, "an administrative body has no power to grant a
rehearing or to set aside or modify its decisions except by virtue
of express statutory provision or by necessary implication." Id.
In that case, the court held that the board had no authority to
reconsider its own earlier determination that it had no
jurisdiction to hear a case, where the statute granting the Board
the power to review its decisions limited that power "solely to the
adjustment of the rate of compensation where there is a change in
the physical condition of the claimant . . . ." Id. In this case,
by contrast, the relevant statute, as noted above, confers on the
Board a very broad power to modify its earlier decisions.
Sulkosky's argument on this point is frivolous and is rejected.
B. Board Compliance With Requirements For Rehearing And
Modification.
Sulkosky next claims that the board "erred in the
decision to terminate permanent total disability compensation by
failing to discuss or apply the proper standard for a rehearing"
and instead simply declaring "that it had authority to make a
determination under AS 23.30.180 on continuing total disability and
also had authority to modify its award under AS 23.30.130(a)."
Specifically, Sulkosky complains, the Board "cited no authority for
those conclusions of law"and "did not, for instance, conclude that
it was required to follow the provisions of [section] .130(a) or
its regulations." Also, "[t]he Board never required the petitioner
to meet the provisions of 8 AAC 45.150 in spite of requests by the
employee to do so."
The statutory provisions read, in relevant part, as
follows:
(a) Upon its own initiative, or upon the
application of any party in interest on the
ground of a change in conditions . . . or
because of a mistake in its determination of a
fact, the board may . . . review a
compensation case . . . . [T]he board may
issue a new compensation order which
terminates, continues, reinstates, increases,
or decreases the compensation, or award
compensation.
AS 23.30.130(a).
In case of total disability adjudged to
be permanent 66 2/3 per cent of the injured
employee's average weekly wages shall be paid
to the employee during the continuance of the
total disability. . . . [P]ermanent total
disability is determined in accordance with
the facts.
AS 23.30.180 (1981) (emphasis added).
Given the plain language of the statutes, Sulkosky's
first complaint is utterly devoid of merit. AS 23.30.130(a)
expressly authorizes the Board to modify its own earlier orders, as
does AS 23.30.180, by implication, since it is the Board which must
decide if and when the "continuance"of the "total disability"has
come to an end. See AS 23.30.110(c) (the Board is the decision-
making body in workers' compensation cases). There was no need for
the board to cite case law reiterating what is stated in the
statutes. Moreover, the Board was under no obligation to
"conclude"that it was bound by AS 23.30.130(a) or the regulations
promulgated thereunder. Obviously it was bound by them; the
question is whether it complied with them.
Thus the substance of Sulkosky's objection is reduced to
the question whether the Board complied with 8 AAC 45.150. The
regulation reads, in relevant part, as follows:
(a) The board will, in its discretion, grant
a rehearing to consider modification of an
award only upon the grounds stated in AS
23.30.130.
(b) A party may request a rehearing or
modification of a board order by filing a
petition for a rehearing or modification
. . . .
. . . .
(d) A petition for a rehearing or modification
based on an alleged mistake of fact by the
board must set out specifically and in detail
(1) the facts upon which the original
award was based;
(2) the facts alleged to be erroneous,
the evidence in support of the allegations of
mistake, and, if a party has newly discovered
evidence, an affidavit from the party or the
party's representative stating the reason why,
with due diligence, the newly discovered
evidence supporting the allegation could not
have been discovered and produced at the time
of the hearing; and
(3) the effect that a finding of the
alleged mistake would have upon the existing
board order or award.
(e) A bare allegation of . . . mistake of
fact without specification or details
sufficient to permit the board to identify the
facts challenged will not support a request
for a rehearing or a modification.
8 AAC 45.150 (April 1991). Sulkosky claims that he requirements of
the regulation were not met because "[t]here was never any petition
which set out what findings of fact of the Board from the [1988]
decision were alleged to be mistaken."
Aetna filed its Petition to Modify in November 1990 along
with an Affidavit in Support of Petition for Modification. These
were followed, two years later, by a Brief in Support of Petition
to Modify. The Petition states that
[s]ubsequent to the date of the Board's [1988]
Decision and Order in this case extensive
surveillance was conducted of claimant Eugene
Sulkosky. That surveillance shows Mr.
Sulkosky acting for long periods of time in a
full and unrestricted manner which is
inconsistent with his testimony before this
Board, inconsistent with deposition testimony,
and entirely consistent with the vocational
rehabilitation plan previously promulgated.
It is further counsel's assertion that he will
utilize these films to establish that there is
no disability as a result of Mr. Sulkosky's
injury with this employer.
In his accompanying affidavit, Aetna's counsel stated that "Mr.
Sulkosky has been seen on several occasions engaging in activities
inconsistent with the Board's conclusion that he is permanently and
totally disabled,"and that this evidence was not available at the
1988 hearing because Sulkosky was not observed, at that time,
engaging in activities sufficient to justify a petition to modify.
Aetna's Brief in Support of the Petition essentially repeated the
same point, in somewhat broader terms: the new evidence would
demonstrate that "there is, in fact, no disability as a result of
the claimant's industrial injury."
The petition makes clear that what Aetna alleged was
mistaken was the Board's earlier determination, based on Sulkosky's
prior testimony before the Board and in deposition, that Sulkosky
was permanently totally disabled. This was sufficient to satisfy
the requirements of the regulation. More important, the Board
obviously found the petition to be sufficiently specific, and the
Board's judgment on this matter would appear to be dispositive:
the regulation, after all, speaks of "specification or details
sufficient to permit the board to identify the facts challenged,"
8 AAC 45.150(e) (emphasis added), and the decision whether to grant
a rehearing lies within the Board's discretion. 8 AAC 45.150(a).
(EN2)
Moreover, it should be noted that, even if the regulation
is construed as a means of protecting an opposing party by
providing notice of the basis upon which a petition for rehearing
is made, rather than as a device allowing the Board to screen out
frivolous petitions, Sulkosky has no basis for complaint. Error is
reversible in this context only if it resulted in substantial
prejudice to Sulkosky's rights. See Fairbanks North Star Borough
v. Rogers and Babler, 747 P.2d 528 (Alaska 1987). The supreme
court has explained that
the modern trend in administrative pleading is
to require simply that the parties be
sufficiently apprised of the nature of the
proceedings so that there is no unfair
surprise. Moreover, since the basic element
to be satisfied is the opportunity to prepare
one's case, the actual content of the notice
and information is not dispositive. The
question is whether the complaining party had
sufficient notice to understand the nature of
the proceedings. That is, unlike a formal
complaint in a civil action, defects in
administrative notice may be cured by other
evidence that the parties knew what the
proceedings would entail.
North State Tel. Co. v. Alaska Pub. Util. Comm'n, 522 P.2d 711, 714
(Alaska 1974) (citation omitted). In this case, two years elapsed
between the filing of the petition and the rehearing on the merits,
and full discovery was had by both sides. (EN3) Sulkosky knew, far
in advance of the hearing, exactly what Aetna's "new evidence"was
and what it would be used to show. Sulkosky does not indicate how
his rights were prejudiced by the asserted lack of specificity on
the face of the petition, especially since that document was only
an opening salvo in this round of litigation and was followed by
full discovery and briefing. Sulkosky's claim of error on this
point is utterly without merit.
C. Permanent Total Disability and Its Relationship to
Suitable Gainful Employment
Next, Sulkosky argues that his "claim of continued
permanent total disability is presumed to be compensable"under AS
23.30.120, Brief at 14, and that "[o]nce an employee is disabled,
the law presumes that the employee remains þdisabled unless and
until the employer introduces "substantial evidence"to the
contrary.þ" These are basic propositions of workers' compensation
law, and Aetna does not dispute them. Rather, it contends that
there was no error precisely because it did produce evidence of
sufficient substantiality both to rebut the presumption of
compensability and to win the case on the merits. That argument is
considered infra.
The dispute centers around the next stage of Sulkosky's
argument on this point. To Aetna's suggestion that he take a job
as a dispatcher or rate clerk, Sulkosky responds that "[p]hysically
and mentally [those jobs] are inappropriate,"because he is able
only "to tinker around at various þodd jobsþ for limited periods of
time." Notwithstanding any ability he might have to earn money
sporadically, Sulkosky explains, his "physical condition is such as
to disqualify him for regular employment in the labor market,"and
he is therefore totally disabled. The underlying premise of the
argument is that, as Sulkosky argues, "[r]egular employment which
is þsuitable gainful employmentþ is that which gives the employee
not less than 70% of pre-injury earnings." Even if he were able to
do the dispatcher or rate clerk jobs, "those are not suitable
gainful employment as required by the [workers' compensation
statute],"because they would not pay at least 70 per cent of his
average weekly wage at the time of his injury. Thus, Sulkosky
explains, the Board erred when it found that he was capable to
working full-time in a "sedentary"job which would pay
approximately $6 per hour, and therefore was not permanently
totally disabled, because "[i]t failed at all to consider whether
this met the Alaska requirement of restoration to suitable gainful
employment. The employer did not show it had identified a job the
claimant could do that met these requirements." In short, Sulkosky
argues, Aetna has not met its burden of coming forward "to overcome
the presumption [of compensability] by substantial evidence that
the employee is not permanent totally disabled, i.e. that there is
suitable gainful employment available to him."
There are at least two components to Sulkosky's argument.
To some extent, he is simply claiming that the Board erred in its
factual determination that he was physically capable of working
full time and was therefore not an "odd lot"employee. That is a
question for "substantial evidence"review and is considered infra.
More important is the claims, repeated numerous times
throughout Sulkosky's 50-page brief, that, because he has not been
restored to "suitable gainful employment,"he is therefore
permanently totally disabled. This is simply incorrect. A review
of some of the relevant definitions may prove helpful.
- "Disability"refers not to actual physical injury, but,
rather, to an "incapacity because of injury to earn the wages which
the employee was receiving at the time of injury in the same or any
other employment." AS 23.30.265(10) (Supp. 1982) (emphasis added).
- "Permanent total disability"was not defined in the
former law. Rather, the statute provided that
[i]n case of total disability adjudged to be
permanent 66 2/3 per cent of the injured
employee's average weekly wages shall be paid
to the employee during the continuance of the
total disability. . . . [P]ermanent total
disability is determined in accordance with
the facts.
AS 23.30.180 (1981). (EN4)
- The "odd lot"doctrine is a well-established judicial
gloss on the workers' compensation statute, though not part of the
statute itself. Essentially, it provides that a worker need not be
in a state of "abject helplessness"before he can be found
permanently and totally disabled. J.B. Warrack Co. v. Roan, 418
P.2d 986, 988 (Alaska 1966). A worker may be permanently totally
disabled if he is unable "because of injuries to perform services
other than those which are so limited in quality, dependability or
quantity that a reasonably stable market for them does not exist."
Id. Put another way, the fact that a worker is capable of
performing sporadic "odd job"labor, for which a reasonably stable
market does not exist, will not preclude a finding of permanent
total disability. See Alaska Int'l Constructors v. Kinter, 755
P.2d 1103 (Alaska 1988).
- "Suitable gainful employment"was defined, at the time in
question, as
employment that is reasonably attainable in
light of an individual's age, education,
previous occupation, and injury, and that
offers an opportunity to restore the
individual as soon as practical to a
remunerative occupation and as nearly as
possible to his average weekly wage as
determined at the time of injury.
AS 23.30.265(31) (Supp. 1982).
. . . .
- Finally, AS 23.30.041(c) (Supp. 1982) provides that a
worker is entitled to vocational rehabilitation if "two distinct
events"occur: the worker suffers permanent disability, and that
disability precludes the employee from returning to suitable
gainful employment. Kirby, 821 P.2d at 129.
In light of these statutory provisions, it is clear that
Sulkosky meshes two separate concepts when he argues that, unless
and until he is offered "suitable gainful employment,"he remains
"permanently totally disabled." "Suitable gainful employment,"as
Aetna points out, is a statutory term of art used, and meaningful,
only in the context of a determination of the employee's
eligibility for vocational rehabilitation under AS 23.30.041. Cf.
Olson v. AIC/Martin J.V., 818 P.2d 669, 674-75 (Alaska 1991)
(discussing "suitable gainful employment"in the context of
vocational rehabilitation benefits); Kirby v. Alaska Treatment
Center, 821 P.2d 127, 129-30 (Alaska 1991) (same). Clearly
Sulkosky is "permanently disabled." Whether this disability
precludes his return to "suitable gainful employment"is a question
relevant only to his entitlement to vocational rehabilitation. It
has nothing to do with the entirely separate matter of whether the
permanent disability is partial or total.
Thus Sulkosky distorts the law when he claims that Alaska
law requires that he be found "permanent totally disabled"unless
and until he is restored to suitable gainful employment, i.e.,
unless and until Aetna "provide[s] the Board with evidence that
there is a job [he] can do that would pay him 70% of his average
weekly wage."(EN5) To avoid paying permanent total disability
benefits, an employer need show only that there is "regularly and
continuously available work in the area suited to the [employee's]
capabilities,"i.e., that he is not an "odd lot"worker. See
Summerville v. Denali Center, 811 P.2d 1047, 1051 (Alaska 1991).
Whether "suitable gainful employment"is available to the employee
is, to reiterate, a separate question. Sulkosky's argument is
therefore rejected. For this reason, the court need not reach
Sulkosky's further argument that the Board erred by "failing to
properly allocate the burden of proof regarding suitable gainful
employment."
D. The Failure to Address "Suitable Gainful Employment"
Sulkosky next argues that the Board erred by "failing to
decide the issue of suitable gainful employment." This was, he
claims, error for two reasons:
First, the issue had been brought up time and
again by the employee for nearly the past six
years. Beyond that, it is part and parcel of
the requirement on the employer to meet its
burden of proof that the employee was restored
to suitable gainful employment and, therefore,
was no longer permanently totally disabled.
The second reason put forward by Sulkosky is without merit, for the
reasons discussed supra: whether Sulkosky's permanent disability
was total or partial is a question entirely separate from the
question whether, because he is permanently disabled, he has been
or must be offered "suitable gainful employment." The
"requirement"to which Sulkosky refers simply does not exist.
In the alternative, Sulkosky argues that this issue has
been raised repeatedly over the years but has not been addressed by
the Board. In its first decision in this case, the board declined
to address the "suitable gainful employment"issue both because
Sulkosky, it stated, had not appealed the Rehabilitation
Administrator's decision on this issue (a statement Sulkosky
disputes, and because, since it found Sulkosky to be permanent
totally disabled, vocational rehabilitation was a moot issue. Cf.
Rydwell v. Anchorage School Dist., 864 P.2d 526, 531 n.5 (Alaska
1993) (on reaching medical stability, an employee receiving
reemployment benefits who is found to be permanently totally
disabled must "cease reemployment training because it will be
fruitless"). In its most recent D&O, the board stated that the
issue of "suitable gainful employment""was not scheduled for
consideration at the recent hearing and [Aetna] did not submit any
evidence on the subject. Although that issue, and others, may
still need to be resolved, we decline to do so at this time." In
his brief, Sulkosky does not contest the statement that "suitable
gainful employment"was not scheduled for consideration at the
Board's hearing. (EN6) At any rate, the Board has not foreclosed
the issue; it simply declined to rule on it at the most recent
hearing. Sulkosky is free to seek a ruling from the Board on this
entitlement to vocational rehabilitation and, a fortiori, on the
"suitable gainful employment"issue. The failure to rule on it at
the most recent hearing does not support Sulkosky's claim that
"[t]otal reversal and remand of the AWCB's decision is necessary."
. . . .
F. Sulkosky's Employability, Credibility, and Capability
Sulkosky next argues that the Board erred in finding that
he was "employable on a regular, steady, and continuous basis,"
that he was not a credible witness, and that he was "capable of
various actions, based on the speculation of the investigator."
Each of these was a factual determination, subject only to
"substantial evidence"review by this court, and must be upheld if
a reasonable person, in light of all the evidence, could have
reached the same conclusion; this court may not reweigh the
evidence. See Yahara v. Construction & Rigging, Inc., 851 P.2d 69
(Alaska 1993). The findings will be addressed in turn.
1. Sulkosky begins by arguing that the Board erred when
it determined, without substantial evidence to support its finding
and based solely on testimony from Sulkosky's former physician, Dr.
Miskovsky, that he was (1) capable of working full-time at a
sedentary job and was (2) therefore not an "odd lot"employee.
(a) The objection is unpersuasive. The Board,
contrary to Sulkosky's assertion, did not rely solely on Dr.
Miskovsky's testimony. Rather, it also relied on extensive
videotape and photographic evidence of
[Sulkosky's] activities in April, July and
October 1990. This evidence show[ed]
[Sulkosky] raking piles of debris in his yard;
operating a rototiller; driving; twisting;
pushing; pulling; bending at the waist;
squatting; reaching overhead; bending at the
waist while cranking a jack on his
recreational vehicle; splitting a log for fire
wood; walking on uneven ground without a cane;
rowing a boat; and with assistance, lifting
and pushing two boats (a 12 foot aluminum
skiff and a small fiberglass boat) to the tops
of trucks.
Moreover, the Board was perfectly free, if it wished, to rely on
Dr. Miskovsky's testimony. Dr. Miskovsky explained that he had
previously determined Sulkosky's physical capacities (a
determination relied upon by the Board in its 1988 hearing) by
asking Sulkosky what Sulkosky believed those capacities to be, and
that he (Dr. Miskovsky) believed "the videotape evidence [produced
in connection with this proceeding] demonstrates [Sulkosky's]
physical capacities more accurately than the [physical capacities
evaluation] . . . relied upon in [the 1988 hearing]." Relying on
both the surveillance evidence and Dr. Miskovsky's testimony, the
Board found that Sulkosky was capable of working "for eight hours
per day, 40 hours per week in a sedentary job"and was therefore
not an "odd lot"employee and not totally disabled.
Sulkosky testified in his own behalf, as did Gary Fisher,
a rehabilitation specialist employed by Sulkosky. Sulkosky
explained that the "surveillance videotape evidence does not
demonstrate what he is capable of doing on a regular continuous
basis,"and that he simply "þover did itþ"and "paid the
consequences with increased pain." Fisher testified that, in light
of Sulkosky's physical and mental limitations, "there is no job
[Sulkosky] can return to."
There was conflicting evidence on this question, but more
than enough evidence (e.g., expert opinions and voluminous
videotape and photographic surveillance) for the Board to conclude
that Sulkosky's physical condition was such that he could work
full-time in a sedentary occupation. The Board's finding on this
matter was supported by more than substantial evidence and is
therefore upheld.
(b) Sulkosky also argues, at least implicitly, that
Aetna did not overcome the presumption that he remained an "odd
lot"employee, and therefore totally disabled, because it
introduced no evidence that there was actually work available to
him, and instead simply assumed that work was available to someone
capable of working full-time in a sedentary job. This argument is
inextricably meshed, in his brief, with the mistaken claim that
Aetna was obligated to demonstrate the availability to him of
"suitable gainful employment." Taken on its own, however, it
remains unpersuasive.
Professor Larson has explained that the burden of proving
the availability of work is, indeed, on the employer in "odd lot"
cases:
If the evidence of obvious physical
impairment, coupled with other facts such as
claimant's mental capacity, education,
training, or age, places claimant prima facie
in the odd-lot category, the burden should be
on the employer to show that some kind of
suitable work is regularly and continuously
available to the claimant.
3 A. Larson, The Law of Workmens' Compensation, sec. 57.61(c), at
10-405-408 (1993) (emphasis added). (EN7) However, Larson also
explains that "[w]hen an award is modified for a reason . . . going
to some error in the original award, the correction may be made
retroactive to the date of the original award . . ." Id.
sec. 81.52(d), at 15-1169.
In this case, the petition to modify and the Board's D&O
were based on a theory of "mistake of fact,"the asserted mistake
being that Sulkosky had in fact not suffered the physical
impairment which the Board, in 1988, thought he had. The initial
determination of "odd lot"status depended on the initial
determination of Sulkosky's physical capabilities; having revised
this initial determination of Sulkosky's "obvious physical
impairment,"such that he never was placed, prima facie, in the
"odd lot"category to begin with, there was no presumption of
entitlement to "odd lot"status to overcome. (EN8)
2. Sulkosky next claims that the Board erred by finding,
without substantial evidence, that he was not a credible witness.
Sulkosky's argument on this point consists largely of an attack on
the validity of Dr. Miskovsky's testimony, and of a benign
explanation of the fact that Sulkosky used a cane in his
appearances before the Board but had not done so while on the
camping trip that was the subject of much of the videotape
surveillance.
Credibility is a determination to be made by the Board:
The board has the sole power to determine the
credibility of a witness. A finding by the
board concerning the weight to be accorded a
witness's testimony, including medical
testimony and reports, is conclusive even if
the evidence is conflicting or susceptible to
contrary conclusions. The findings of the
board are subject to the same standard of
review as a jury's finding in a civil action.
AS 23.30.122. The Board found, inter alia, that Sulkosky had
"exaggerated the extent of his physical limitations when describing
his condition to his treating physicians and in his testimony
before us,"that he had exaggerated the severity of his condition
when appearing before the Board in 1988, that the "surveillance
evidence clearly demonstrates that [Sulkosky] is able to walk, even
on uneven ground, without the assistance of a cane and that he is
able to engage in relatively vigorous activity,"and that Sulkosky
"uses his cane as a þpropþ to enhance the appearance of
disability." On this basis, the Board found that Sulkosky was not
a credible witness. That finding is supported by more than
substantial evidence and must be upheld.
3. Finally, Sulkosky claims that the Board erred in
finding that he was "capable of various actions,"based upon the
"speculation"of Aetna's investigator, Wayne Willott.
Specifically, Sulkosky argues that the Board's finding that he was
"able to walk, even on uneven ground, without the assistance of a
cane"and "able to engage in relatively vigorous activity: was,
"apparently,"based upon Willott's testimony before the Board, and
that that testimony was mere "speculation"upon which a reasonable
person would not rely.
This is unpersuasive. The Board clearly relied on the
surveillance evidence itself in making these findings. Moreover,
while the Board apparently did not rely on Willott's testimony in
making its findings ("We rely on the surveillance evidence and Dr.
Miskovsky's testimony"), it was perfectly free to do so if it
wished. It was Willott who made the videotapes and observed
Sulkosky during the times in question. He could testify to what he
saw or did not see. If he was, as Aetna's agent, a biased witness,
the Board could take that into account in making its determination
of what weight to accord his testimony under AS 23.30.122.
Sulkosky's claim of error on this point is unpersuasive.
G. Attorney Fees
Sulkosky next argues that the Board erred by ordering
that attorney fees of $6,767.50, relating to his successful efforts
to force Aetna to release its surveillance and investigative
materials, be paid out of his own compensation. He claims that
Aetna should have to pay these fees because he succeeded on the
issue.
In support of his position, Sulkosky cites only AS
23.30.145. The relevant subsection of that statute provides that
"if the claimant has employed an attorney in the successful
prosecution of the claim, the board shall make an award to
reimburse the claimant for the costs in the proceedings. . . ." AS
23.30.145(b). The supreme court has stated clearly that "the
employee must be successful on the claim itself, not on a
collateral issue." Adamson v. Univ. of Alaska, 819 P.2d 886, 895
(Alaska 1991). "[T]he Board should look at who ultimately is
successful on the claim, as opposed to who prevails at each
proceeding." Id.
In this case, "[Sulkosky's attorney] was successful in
securing the release of the surveillance materials before the
[November 1992] hearing. However, the underlying issue and the
reason for the surveillance was [Sulkosky's] continued entitlement
to [permanent total disability] compensation. [Sulkosky] has not
prevailed on that issue." In short, Sulkosky prevailed on an
interlocutory discovery dispute; even as to this dispute, he did
not prevail entirely, as Aetna was allowed to redepose him before
releasing the videotapes and was allowed to retain any evidence
which revealed the work product of its attorney or investigators.
More important, as the Board pointed out, Sulkosky lost on the
merits of this case: Aetna claimed, and the Board found, that
Sulkosky was not, in fact, permanently totally disabled. Sulkosky
was therefore not entitled to have Aetna pay for his attorney's
work on the discovery dispute. For the same reason, Sulkosky is
not entitled to payment by Aetna of various other costs and fees,
including $4,200 in fees for his vocational rehabilitation
specialist's testimony.
. . . .
III. SUMMARY
The Board's decision that Aetna did not have to pay Dr.
Brack's medical bills for services provided to Sulkosky, due to the
doctor's failure to file the proper forms, is REVERSED, and Aetna
is ordered to pay for the medical treatment at issue and for the
travel costs associated with receiving that care. Sulkosky's claim
that Aetna's controversion of this matter was frivolous is REMANDED
to the Board. In all other respects, the Board's decision in this
matter is AFFIRMED.
Dated at Ketchikan, Alaska, this 5th day of April, 1994.
/s/ Thomas M. Jahnke
Superior Court Judge
ENDNOTES (Memorandum of Decision and Order):
1. The "odd lot"doctrine is discussed infra at Appendix -Page
15.
2. See also Alaska Indus. Bd. v. Chugach Elec. Ass'n, 17 Alaska
183, 192 (9th Cir. 1957), rev'd on other grounds, 356 U.S. 320, 17
Alaska 575 ("[s]ince the board had the power to reopen the matter
on its own motion, and since it did desire to reopen, the action
taken is to be deemed a reopening on the board's own motion,"
suggesting that requirement of specific pleading in a petition to
modify is for the Board's benefit). Indeed, the Board's decision
and order itself - to say nothing of the initial petition to modify
- could be upheld on appeal, despite a failure to state explicitly
"'so long as the findings of fact disclosed the theory of the new
order and it was supported by substantial evidence.'" Fischback &
Moore of Alaska, Inc. v. Lynn, 430 P.2d 909, 912 n.14 (Alaska 1967)
(quoting Jarka Corp. v. Hughes, 299 F.2d 534, 536 (2d Cir. 1962)
(citing Bethlehem Shipbuilding Corp. v. Cardillo, 102 F.2d 299 (1st
Cir. 1939))).
3. Except for ten pages of notes not turned over to Sulkosky,
discussed infra.
4. The statute also described certain injuries, not relevant
here, which constituted "permanent total disability"per se.
5. That is, a job that would pay Sulkosky - who did not complete
high school and has difficulty with reading and mathematics - well
over $50,000 per year.
6. Indeed, in what appears to be the final prehearing conference
summary, dated October 20, 1992, there is no mark next to "Voc
Rehab"in the section labelled "Relief Sought,"nor is "suitable
gainful employment"mentioned in the written notations.
7. It should be noted that the term "suitable work,"as used by
Professor Larson, is not the same thing as "suitable gainful
employment,"as that term of art is used in the Alaska statutes.
Indeed, the latter term made its first appearance in the statutes
in July 1982 at the same time as AS 23.20.041, the section
pertaining to vocational rehabilitation, was enacted.
8. Thus, the situation here is quite different from one where,
for example, the Board leaves intact an initial determination of an
employee's physical impairment, and simply revises its view as to
whether his overall capabilities, in light of that impairment, are
so limited, in the context of the local job market, as to place the
employee in the "odd lot"category. In such a case, the employee
would be entitled to a presumption of continuing "odd lot"status
until substantial evidence were introduced to the contrary, i.e.,
evidence that jobs actually were available to persons with
capabilities similar to the employee's.
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