ADJ13182924 · January 3, 2025

The WCJ exercised discretion to deny credit for overpayment of temporary disability indemnity because the applicant was prejudiced by the delay and the credit amount was significant relative to the permanent disability award.

From the decision · page 4Finally, with regard to the issue of crediting the overpayment of temporary disability indemnity towards defendant's permanent disability indemnity, the WCJ wrote in the Report:

The WCJ and Appeals Board found the 17% permanent disability rating supported by substantial evidence and rejected apportionment due to lack of explanation in medical reports for nonindustrial factors and no evidence of prior awards for overlap under Labor Code section 4664.

From the decision · page 1Defendant seeks reconsideration of a workers' compensation administrative law judge's (WCJ) Findings of Fact and Award and Order of October 8, 2024, wherein it was found that while employed on October 3, 2019 as a bus operator, applicant sustained industrial injury to the cervical spine and left shoulder causing permanent disability of 17%. In finding permanent disability of 17%, it was found that there was no basis for apportionment. Additionally, the WCJ did not allow defendant to credit an overpayment of temporary disability indemnity towards its permanent disability indemnity liability.

Dr. Roland's medical reports did not explain how nonindustrial factors contributed to the applicant's permanent disability impairment.

Favours Applicant prevailed

This lack of explanation led to rejection of apportionment under Labor Code section 4663, supporting the 17% permanent disability rating without apportionment.

From the decision · page 3In the April 5, 2024 report, Dr. Roland apparently copied the text of the May 11, 2020 cervical spine x-ray report, and then stated that there was evidence of unspecified "prior injuries, impairment or underlying non-industrial pathology" which contributed to the cervical spine impairment, and apportioned 10% to the unspecified preexisting pathology. The only other report of Dr. Roland to discuss impairment for the cervical spine was the November 5, 2020 report. In that report, the apportionment discussion does not contain the verbatim transcript of the cervical spine x-ray report, but the analysis again merely attributing 10% of the impartment to unspecified preexisting pathology with no further explanation. (Joint Exhibit 103, page 23.) There is no discussion in either report about what precisely the pre-existing pathology was, let alone a discussion as to how it contributed to the applicant's current level of impairment. Without explaining what the pre-existing pathology was, and how and why it contributed to the current impairment, Dr. Roland's apportionment determination is not substantial evidence.

Defendant did not present evidence of a prior permanent disability award to support apportionment under Labor Code section 4664.

Favours Applicant prevailed

Without evidence of prior award and overlap, apportionment under section 4664 was properly denied.

From the decision · page 4Here, the defendant did not introduce into evidence or request judicial notice of any prior award of permanent disability.1 Additionally, any medical reporting that the stipulated award in the prior case was based on was not admitted into the evidentiary record. Since defendant presented no evidence at all on the Labor Code section 4664 issue, and in fact defendant did not specifically raise the issue until its Petition for Reconsideration, the WCJ properly found no Labor Code section 4664 apportionment. Although the applicant suggests in his Answer that defendant or its counsel should be "disciplined" for its belated and unsupported contention regarding section 4664 apportionment, we decline the suggestion to impose sanctions.

Applicant was prejudiced by the delay in receipt of Dr. Roland's report during the overpayment period of temporary disability benefits.

Favours Applicant prevailed

This prejudice supported the WCJ's exercise of discretion to deny defendant credit for the overpayment, protecting applicant's permanent disability award.

Dr. Roland apportioned 10% of cervical spine impairment to unspecified preexisting pathology without explanation, which was found insufficient for apportionment under Labor Code section 4663. For the left shoulder, he noted a prior 2018 injury but did not explain how it contributed to current impairment.

The medical reports lacked explanation for how nonindustrial factors contributed to impairment, thus not substantial evidence for apportionment.

From the decision · page 3In the April 5, 2024 report, Dr. Roland apparently copied the text of the May 11, 2020 cervical spine x-ray report, and then stated that there was evidence of unspecified "prior injuries, impairment or underlying non-industrial pathology" which contributed to the cervical spine impairment, and apportioned 10% to the unspecified preexisting pathology. The only other report of Dr. Roland to discuss impairment for the cervical spine was the November 5, 2020 report. In that report, the apportionment discussion does not contain the verbatim transcript of the cervical spine x-ray report, but the analysis again merely attributing 10% of the impartment to unspecified preexisting pathology with no further explanation. (Joint Exhibit 103, page 23.) There is no discussion in either report about what precisely the pre-existing pathology was, let alone a discussion as to how it contributed to the applicant's current level of impairment. Without explaining what the pre-existing pathology was, and how and why it contributed to the current impairment, Dr. Roland's apportionment determination is not substantial evidence.

Labor Code section 4663

Labor Code section 4663 requires a doctor to address the percentage of permanent disability attributable to industrial injury and other factors, with substantial evidence requiring explanation of apportionment.

Applied to reject apportionment based on insufficient explanation in medical reports.

From the decision · page 3Labor Code section 4663 mandates that a doctor, when addressing permanent disability, address the percentage of permanent disability attributable to the industrial injury as well as the percentage attributable to other factors. With respect to permanent disability, the applicant holds the burden of proof by a preponderance of the evidence. (Labor Code section 3202.5.) The defendant has the burden of establishing the percentage of permanent disability caused by nonindustrial factors. (Escobedo vs. Marshalls (2005) 70 Cal. Comp. Cases 604, 614 (en banc).) In order to be considered substantial medical evidence on apportionment, the medical opinion "must set forth reasoning in support of its conclusions." (Id. at 621.)

Labor Code section 4664

Labor Code section 4664 requires proof of prior permanent disability award and overlap to apportion disability.

Applied to reject apportionment due to lack of evidence of prior award and overlap.

From the decision · page 4With regard to Labor Code section 4664 apportionment, in order to find apportionment under Labor Code section 4664, the defendant must prove that there is overlap between the current disability and the disability that was subject to the prior award. (Kopping v. Workers' Comp. Appeals Bd. (2006) 142 Cal.App.4th 1099 [71 Cal.Comp.Cases 1229].) According to the Court of Appeal in Kopping, "First, the employer must prove the existence of the prior permanent disability award. Then, having established by this proof that the permanent disability on which that award was based still exists, the employer must prove the extent of the overlap, if any, between the prior disability and the current disability. Under these circumstances, the employer is entitled to avoid liability for the claimant's current permanent disability only to the extent the employer carries its burden of proving that some or all of that disability overlaps with the prior disability and is therefore attributable to the prior industrial injury, for which the employer is not liable." (Id. at p. 1115.)

Labor Code section 4909

Labor Code section 4909 gives WCJ discretion to award credit for overpayment of benefits.

Applied to uphold WCJ's denial of credit for overpayment of temporary disability indemnity.

From the decision · page 4Finally, with regard to the issue of crediting the overpayment of temporary disability indemnity towards defendant's permanent disability indemnity, the WCJ wrote in the Report:

Dr. Roland's apportionment opinions lacked explanation for nonindustrial factors' contribution to impairment.

From the decision · page 3In the April 5, 2024 report, Dr. Roland apparently copied the text of the May 11, 2020 cervical spine x-ray report, and then stated that there was evidence of unspecified "prior injuries, impairment or underlying non-industrial pathology" which contributed to the cervical spine impairment, and apportioned 10% to the unspecified preexisting pathology. The only other report of Dr. Roland to discuss impairment for the cervical spine was the November 5, 2020 report. In that report, the apportionment discussion does not contain the verbatim transcript of the cervical spine x-ray report, but the analysis again merely attributing 10% of the impartment to unspecified preexisting pathology with no further explanation. (Joint Exhibit 103, page 23.) There is no discussion in either report about what precisely the pre-existing pathology was, let alone a discussion as to how it contributed to the applicant's current level of impairment. Without explaining what the pre-existing pathology was, and how and why it contributed to the current impairment, Dr. Roland's apportionment determination is not substantial evidence.

No evidence of prior permanent disability award was introduced by defendant for Labor Code section 4664 apportionment.

From the decision · page 4Here, the defendant did not introduce into evidence or request judicial notice of any prior award of permanent disability.1 Additionally, any medical reporting that the stipulated award in the prior case was based on was not admitted into the evidentiary record. Since defendant presented no evidence at all on the Labor Code section 4664 issue, and in fact defendant did not specifically raise the issue until its Petition for Reconsideration, the WCJ properly found no Labor Code section 4664 apportionment. Although the applicant suggests in his Answer that defendant or its counsel should be "disciplined" for its belated and unsupported contention regarding section 4664 apportionment, we decline the suggestion to impose sanctions.

Applicant was prejudiced by delay in receipt of medical report during overpayment period, supporting denial of credit to defendant.