Willoughby v. Goodyear Tire & Rubber

391 P.3d 711 (Table)

Tammy Lee WILLOUGHBY, Appellant,

v.GOODYEAR TIRE AND RUBBER, and Liberty Mutual Insurance, Co., Appellees.

No. 115,898

Court of Appeals of Kansas.

Opinion filed February 17, 2017

Bruce Alan Brumley, of Topeka, for appellant.

Timothy A. Shultz, and Alison J. St. Clair, of Goodell, Stratton, Edmonds & Palmer, L.L.P., of Topeka, for appellees.

Before Hill, P.J., Green, J., and Burgess, S.J.

MEMORANDUM OPINION

Per Curiam:

Tammy Willoughby, an employee of Goodyear Tire and Rubber (Goodyear), injured her right knee in the course of her employment on August 14, 2013. This was the third time she had experienced a work-related injury to her right knee while employed by Goodyear. Her two previous workers compensation claims were each settled for a rating of 10% partial permanent impairment. There was no settlement of this third claim. The Division of Workers Compensation determined that Willoughby suffered a 10% loss of use of her right leg and ordered corresponding compensation. Goodyear appealed to the Kansas Workers Compensation Board (Board), which ultimately determined that Willoughby had actually suffered a 20% right lower extremity functional impairment. In its deliberations, the Board sua sponte interpreted the American Medical Association Guidelines (Guidelines) to combine Willoughby's two prior 10% awards into a 19% preexisting impairment rating, and pursuant to K.S.A. 2015 Supp. 44–501(e)(2)(A) then reduced Willoughby's award to $0. Willoughby appealed. We reverse and remand with directions.

FACTUAL AND PROCEDURAL BACKGROUND

Willoughby, an employee of Goodyear, injured her right knee in the course of her employment on August 14, 2013. She was diagnosed with a tear to the right medial meniscus and underwent corrective surgery and rehabilitation. She filed a claim for workers compensation. Goodyear disputed the nature and extent of Willoughby's injury and denied that any impairment occurred. Willoughby and Goodyear were not able to come to a settlement in the case. After reviewing testimony, on December 7, 2015, the administrative law judge (ALJ) determined that Willoughby suffered a 10% loss of use of the right leg and ordered a corresponding monetary and medical treatment award.

The August 2013 incident marked the third time Willoughby had experienced a work-related injury to her right knee while employed by Goodyear: two previous injuries were in 2010 and 2011, and both required corrective surgery. Willoughby's workers compensation claims from the 2010 and the 2011 injuries were each settled for a rating of 10% partial permanent impairment.

Goodyear appealed the ALJ's December 2015 award of 10% for Willoughby's August 2013 right knee injury to the Board. After considering the record used by the ALJ, the Board ultimately determined that Willoughby had actually suffered a 20% right lower extremity functional impairment. In its deliberations, the Board then sua sponte interpreted the Guidelines to combine Willoughby's prior 2010 and 2011 10% settlements into a 19% preexisting impairment rating. Then, pursuant to K.S.A. 2015 Supp. 44–501(e)(2)(A), the Board reduced Willoughby's award to $0. Willoughby's impairment rating was increased by the Board from the ALJ's 10% rating to a 20% rating, but then reduced to a noncompensable level by the Board's interpretation of the Guidelines and subsequent application of a statutory reduction. Willoughby appealed.

ANALYSIS

The Kansas Judicial Review Act defines the scope of judicial review of state agency actions unless the agency is specifically exempted from application of the statute. K.S.A. 2015 Supp. 77–603(a) ; Ryser v. State , 295 Kan. 452, 458, 284 P.3d 337 (2012). An appellate court exercises the same limited review of the agency's action as does the district court—as if the appeal had been made directly from the agency's action. Kansas Dept. of Revenue v. Powell , 290 Kan. 564, 567, 232 P.3d 856 (2010) ; Johnson v. Kansas Employment Security Bd. of Review , 50 Kan. App. 2d 606, 610, 330 P.3d 1128 (2014), rev. denied 302 Kan. 1010 (2015).

THE BOARD VIOLATED PROVISIONS OF K.S.A. 2015 SUPP. 77–621(c)

A court reviewing an administrative action shall grant relief only if it determines that the agency violated one or more of the provisions of K.S.A. 2015 Supp. 77–621(c). Willoughby explicitly seeks review under K.S.A. 2015 Supp. 77–621(c)(4), which provides relief in the event the Board erroneously interpreted or applied the law. Throughout her appeal brief, Willoughby also impliedly argues that the Board violated other provisions of K.S.A. 2015 Supp. 77–621(c), in that the Board acted beyond its jurisdiction conferred by any provision of law; that the Board engaged in an unlawful procedure or failed to follow prescribed procedure; that the Board did base its decision upon facts or information not supported by the appropriate standard of proof by evidence that is substantial in light of the record as a whole; and that the Board's action was unreasonable, arbitrary, or capricious.

On appeal, the burden of proving the invalidity of the agency action rests with the party asserting such invalidity. K.S.A. 2015 Supp. 77–621(a)(1) ; In re Equalization Appeal of Wagner , 304 Kan. 587, 597, 372 P.3d 1226 (2016) (tax appeal); Golden Rule Ins. Co. v. Tomlinson , 300 Kan. 944, 953, 335 P.3d 1178 (2014) (Kansas Insurance Department agency decision). Here, the burden of proving the Board violated provisions of K.S.A. 2015 Supp. 77–621(c) rests with Willoughby. Willoughby has met her burden.

The Board Exceeded Its Authority and Misapplied the Law

Willoughby argues that the Board exceeded its statutory authority when it combined her two prior settlements of 10% each into a composite 19% preexisting impairment rating and then used that 19% preexisting impairment rating to reduce her current 20% impairment rating to a noncompensable level. If an issue turns on an interpretation of a statute, the court reviews de novo without deference to the decision of the Board. See Hoesli v. Triplett, Inc. , 303 Kan. 358, 362, 361 P.3d 504 (2015) ; Powell , 290 Kan. at 567.

Under K.S.A. 2015 Supp. 44–501(e), the reduction of disability compensation is required by the amount of impairment determined to be preexisting:

"Where workers compensation benefits have previously been awarded through settlement or judicial or administrative determination in Kansas, the percentage basis of the prior settlement or award shall conclusively establish the amount of functional impairment determined to be preexisting . Where workers compensation benefits have not previously been awarded through settlement or judicial or administrative determination in Kansas, the amount of preexisting functional impairment shall be established by competent evidence." (Emphasis added.)

Willoughby's settlements for her previous injuries were conclusively established by the earlier settlement awards of 10%: once in 2010 and again in 2011. Willoughby's award was to be reduced by the current dollar value attributable under the Workers Compensation Act to the percentage of functional impairment determined to be preexisting. K.S.A. 2015 Supp. 44–501(e)(2)(A).

At the core of this appeal is the percentage of functional impairment that was determined to be preexisting for the purpose of reducing Willoughby's award. If the combination of the two previous settlements of 10% each was proper and does equate to 19%, as the Board determined, then Willoughby's 20% impairment award equates to $0. If, however, the functional impairment determined to be preexisting is established by the prior settlement, then Willoughby's prior settlement of 10% is the basis for the preexisting impairment reduction from her current impairment rating of 20%. This would leave Willoughby at a compensable level of 10% for her new permanent partial impairment.

A Plain Reading of the Statute Is Required

Willoughby argues for a plain reading of K.S.A. 2015 Supp. 44–501(e). Under that statute, "the percentage basis of the prior settlement or award shall conclusively establish the amount of functional impairment determined to be preexisting." (Emphasis added.) K.S.A. 2015 Supp. 44–501(e)(1). It is a fundamental rule of statutory construction that the intent of the legislature governs if that intent can be ascertained. Hoesli , 303 Kan. at 362. An appellate court must first attempt to ascertain legislative intent through the statutory language enacted, giving common words their ordinary meanings. Ullery v. Othick , 304 Kan. 405, 409, 372 P.3d 1135 (2016). When a statute is plain and unambiguous, an appellate court should not speculate about the legislative intent behind that clear language, and it should refrain from reading something into the statute that is not readily found in its words. Ullery , 304 Kan. at 409 ; Hoesli , 303 Kan. at 362. The meaning of K.S.A. 2015 Supp. 44–501(e) is perfectly clear. Willoughby's preexisting functional impairment was conclusively established by the prior proceedings. There was no need or legal basis for the Board to go beyond that determination.

The parties extensively argue the Board's utilization of a hypothetical that questioned the plain meaning of K.S.A. 2015 Supp. 44–501(e). The Board engaged in this hypothetical to demonstrate that a plain reading of the statute could leave Willoughby injuring her...