Worker's Compensation
Appeal of Timothy Carnahan, No. 2009-362
(Decided April 8, 2010)

Facts:

The claimant sustained a lower back injury on September 15, 2000 while working as a self-employed tractor-trailer driver and furniture mover.  In June of 2001 he underwent a spinal bone fusion. 

He received temporary total disability benefits until 2006 when, following vocational rehabilitation training, the DOL reduced the claimant’s benefits to the diminished earning capacity rate.  The claimant appealed this decision to the CAB.  While the appeal was pending, the claimant also petitioned the DOL for a new first-level hearing to seek reinstatement of his temporary total disability benefits, claiming that he had a change in his physical condition based on the opinion of his physiatrist that his spinal fusion was unstable.  The petition was denied and the claimant also appealed this decision to the CAB.  The appeals were consolidated for a de novo hearing.

In March of 2007, the CAB ruled that the claimant suffered from an unstable fusion and physical limitations, had a sedentary work capacity, and concluded that the carrier failed to demonstrate a change in condition sufficient to warrant a reduction in benefits.  As a result, the temporary total disability benefits were continued.

In August of 2007, the carrier again petitioned the DOL for a reduction in benefits.  The carrier, relying on an opinion from an orthopedic surgeon who had determined that the spinal fusion was in fact stable, argued that the physiatrist had incorrectly concluded that the fusion was unstable.  In October of 2007, the DOL officer found that the CAB’s decision in March of 2007 was based on the physiatrist’s mistaken diagnosis, but denied the carrier’s request because the DOL hearing officer had not made a determination of the claimant’s earning capacity.

In January of 2008, the carrier petitioned the DOL for a review of the extent of the claimant’s work-related disability.  In May 2008, the DOL found that the claimant had at least a full-time light duty work capacity, which was an improvement from October of 2007.  It concluded that the claimant was no longer entitled to temporary total disability benefits and, based on the length of disability benefits he had already received, effectively terminated the benefits.  The claimant appealed.

After a de novo hearing, the CAB concluded in October of 2008 that its prior determination as to the extent of the claimant’s disability was the result of a mistake, the claimant was “self-limiting”, uncooperative and not credible, that he was capable of at least full-time sedentary work, and, although unlikely to return to his previous job and earning capacity, was capable of returning to gainful employment.   The decision was based in part on video surveillance evidence.  One of the videotapes showed the claimant walking normally in his yard on the day of his hearing in May of 2008, then limping into the DOL.  The other showed him setting up a backyard pool in July of 2008.  The CAB granted the carrier’s request to reduce benefits to the diminished earning capacity rate, effectively terminating benefits. 

The claimant then filed an appeal to the Supreme Court arguing that: 1) in October of 2008 the CAB was barred by res judicata and collateral estoppel from reducing his benefits due to a change in condition because both the DOL and CAB had found in 2006 and 2008 that he had a full-time sedentary or light-duty work capacity; 2) the CAB erred in finding that he had no earning capacity, but was capable of gainful employment because “gainful employment” and “earning capacity” are the same under RSA 281-A:48; and 3) the CAB erroneously relied on the video surveillance evidence.

Held:   

Affirmed.

The Court ruled that the CAB was not barred by res judicata and collateral estoppel from reducing the claimant’s benefits in October of 2008.  Under RSA 281-A:48, any party may petition the CAB for review of a denial or award based on several grounds, including “change in conditions” or “mistake as to the nature or extent of the injury or disability.”  This statute gives the CAB continuous jurisdiction.  The CAB properly exercised its statutory authority to reopen and correct its earlier mistake as to the nature and extent of the claimant’s injury and disability. 

The Court also rejected the claimant’s argument that because “gainful employment” and “earning capacity” have the same meaning under RSA 281-A:48, the CAB improperly reduced his benefits when it found that he “had no earning capacity, but was capable of gainful employment.”  The Court ruled that “gainful employment” and “earning capacity” do not have the same meaning.  The term “earning capacity” is “an objective measure of a worker’s ability to earn wages” and whether he is able to earn “in suitable work and under normal employment conditions” as much as he earned at the time of the injury, using as a reference his overall value in the marketplace based on factors such as age, education and job training. “Gainful employment” is employment which “reasonably conforms to the employee’s age, education, training, temperament and mental and physical capacity to adapt to other forms of labor than that to which the employee was accustomed,” even if that employment does not generate the same level of earnings.  Thus, an employee may be capable of “gainful employment” even if he does not have the same earning capacity as he did at the time of the injury. 

The Court held that the CAB’s findings as to the claimant’s uncooperative and self-limiting attitude supported its conclusion that he had experienced a change in conditions which justified modification of his benefits.  The CAB properly found that although the claimant did not have his previous earning capacity, he was able to obtain full-time gainful employment and had a diminished earning capacity. 

Finally, the Court ruled that the CAB did not err in considering the videotaped surveillance evidence on the issue of the claimant’s physical capacity as of May of 2008.  The evidence supported the CAB’s determination that the claimant was less than forthcoming concerning his physical abilities at the time of the May 2008 DOL hearing.

Regards,

Stephen J. Schulthess

603-634-4300
mailto: sschulthess@gss-lawyers.com