Office of Administrative Law Judges
United States Department of Labor
MONTHLY DIGEST # 124
February 1996 - April 1996
Benefits Review Board
In Mangaliman v. Lockheed Shipbuilding Co., ___
B.R.B.S. ___, BRB No. 92-2308 (Feb. 15, 1996), Claimant was
placed in a light duty position by Employer following his injury
and subsequently fired for unauthorized absences and
unsatisfactory work. Claimant remained unemployed. Employer
argued that Walker v. Sun Shipbuilding and Dry Dock
Co., 19 B.R.B.S. 171 (1986) required that an award of
permanent partial disability be precluded in Mangaliman.
In Walker, the Board held that a job at Employer s
facility, which Claimant loses for reasons unrelated to his
disability, can constitute suitable alternate employment
precluding an award of total disability.
The Board declined to follow Employer's argument stating
that, because Walker involved total disability, it was
distinguishable from a case involving permanent partial
disability and did not, therefore, address the question of post-
injury wage earning capacity under § 8(h) of the Act as was
required in Mangaliman. Section 8(h) provides that, in a
case involving permanent partial disability, a claimant's wage-
earning capacity is his actual post-injury earnings if these
earnings fairly and reasonably represent his wage-earning
capacity.
In this case arising within the Ninth Circuit, the Board
held that "open market" jobs may be considered in
determining post-injury wage earning capacity; namely, "it
is proper for the administrative law judge to consider all
evidence relevant to claimant's wage-earning capacity, including
both the job offered by employer and other suitable jobs."
The Board further stated that "the actual earnings in a
suitable job lost by claimant's misconduct, like any other
suitable job claimant holds post-injury, should be considered by
the administrative law judge in determining claimant's wage
earning capacity." Thus, the Board held that,
"contrary to employer's assertions, the fact that claimant
received actual post-injury wages equal to his pre-injury
earnings does not mandate a conclusion that he has no loss in
wage-earning capacity" as open market conditions may reflect
a lesser wage-earning capacity than that of a job with the
employer.
[ 8.2.4.2, suitable alternate employment; 8.2.4.7
subsequent firing; 8.9.3 market wage versus actual
wage ]
In Harris v. Todd Pacific Shipyards Corp., ___
B.R.B.S. ___, BRB Nos. 93-2227 and 93-2454 (Jan. 25, 1996)(en
banc on recon.), aff'g. in part, rev'g. in part, 28
B.R.B.S. 254 (1994), the Board held that § 33(g) bars claims
for compensation and medical benefits where the employee has
settled with a third party for less than the amount he would be
entitled to under the Act, without the employer s prior written
approval. As a result, two administrative law judges
applied the Supreme Court's holding in Estate of Cowart
v. Nicklos Drilling Co., 112 S.Ct. 2589 (1992), to grant
summary judgment in favor of the employers on the grounds that
the claimants settled third party claims without the employers'
written approval. However, neither administrative law judge made
findings as to whether the settlement amounts were less than the
employers respective liabilities under the Act, reasoning that
such liabilities would either be precluded by § 33(g), or
completely offset under § 33(f).
In assessing the propriety of the judges' decisions,
the Board initially noted that the forfeiture provisions of
§ 33(g) apply only to the person entitled to compensation
(or the person s representative). 33 U.S.C. § 933(g)(1).
Consequently, on reconsideration, the Board reaffirmed its
holding that in occupational disease cases, a claimant is not
injured and thus not a person entitled to compensation until
he is aware of the relationship between the disease, the
disability, and his employment. In order to be aware of his
disability, the Board held that the employee must be aware that
his work-related disease has caused a loss in wage-earning
capacity, or if a voluntary retiree, a permanent physical
impairment. Harris, slip op. at 7. Thus, the Board
adopted a manifestation rule as the best method of determining
when a claimant is injured at which point his rights under the
Act vest and he is a person entitled to compensation. From
this, the Board found that the "manifestation rule"
requires a fact finding and, therefore, summary judgment was
inappropriate.
With regard to applying the "manifestation rule"
in the case of a voluntary retiree, the Board instructed that the
employer must establish that the claimant was aware of the
relationship between his or her asbestos-related disease, the
employment, and a permanent physical impairment, before he or she
has a vested right under Cowart. Significantly, the Board
determined the fact that "claimant has merely filed a claim
is not sufficient to establish that claimant is entitled to
compensation under the Act. Harris, slip op. at 9.
Similarly, the Board was not persuaded by employers arguments
that claimants would not have filed third-party suits unless they
were aware of a work-related physical impairment, since the
reasons for filing tort suits are not limited to the grounds of a
workers compensation claim. Id.
Further, the Board held that the forfeiture provision of
§ 33(g) applies only if the third-party settlement obtained
without employer s prior written approval is for an amount less
than the compensation to which the person . . . would be entitled
under the Act. 33 U.S.C. § 933(g)(1). In this vein, the
Board reaffirmed its holding that the term compensation, as
used in § 33(g), does not include medical benefits. The
Board also reaffirmed its prior holding that the aggregate
third-party settlements should be used in making the less than
comparison.
However, the Board vacated its prior holding that the less
than determination is a comparison between the net amount of the
third-party settlement recoveries and the amount of compensation
to which the claimant would be entitled. Instead, the Board
adopted the Third Circuit s reasoning in Bundens v. J. E.
Brenneman, 46 F.3d 292, 305 (3d Cir. 1995), that the Act
specifies net amount in § 33(f), but not in § 33(g),
and therefore the gross amount of the aggregate third-
party settlement recoveries should be used for comparison under
§ 33(g). This implies the comparing of the gross
amount of the settlement to the compensation benefits for
purposes of § 33(g) while using the net amount for purposes
of the offset provision of § 33(f)).
The Board also affirmed its holding that, where the
forfeiture provision of § 33(g) does not apply, the offset
provision of § 33(f) does not extinguish the employer s
total statutory liability. Instead, § 33(f) merely provides
an employer with a credit in the amount of the net third-party
recovery against its liability for both compensation and medical
benefits. While this may have the practical effect of
extinguishing the employer s liability in many cases, if there is
ongoing liability for medical benefits, it may not.
[ 33.6, employer's net recovery; 33.6.1, Person
entitled to compensation ; 33.7, written approval of
settlement; 33.7.2, Cowart; 33.7.4, medical
benefits ]
In Davison v. Bender Shipbuilding & Repair
Co., ___ B.R.B.S. ___, BRB No. 92-2183 (Feb. 22, 1996), the
§ 20(a) presumption was rebutted as a matter of law where
Claimant suffered a 100% hearing loss to the left ear and a zero
percent loss to the right ear. In so holding, the Board noted
that a physician's "unequivocal medical opinion"
established that the "100 percent hearing loss in claimant's
left ear occurred as a result of a (non work-related) traumatic
fracture of the temporal bone" and the evidence demonstrated
that the claimant was not exposed to any employment-related noise
subsequent to his last day of work." Likewise, it was
proper to deny medical benefits to Claimant under § 7 for an
"amplification device" for his right ear which was
intended "to compensate for the severe hearing loss of the
left ear."
[ 20.3, rebuttal of presumption - hearing loss ]
In Bullock v. Ingalls Shipbuilding, Inc., ___
B.R.B.S. ___, BRB Nos. 90-0194 and 90-0194A (Nov. 24, 1995)(en
banc), a case arising in the Fifth Circuit, the Board held that,
under unpublished precedent of that court, counsel's use of
"a minimum quarter hour billing method was improper."
The Board noted that "the Fifth Circuit held that,
generally, attorneys may not charge more than one-eighth hour for
review of a one page letter and one-quarter hour for preparation
of a one-page letter."
[ 28.6.3, fee petition ]
In Guthrie v. Holmes & Narver, Inc., ___
B.R.B.S. ___, BRB No. 93-0624 (Feb. 27, 1996), the Board held
that "'subsistence and quarters' is, as a matter of law,
included in Claimant's average weekly wage." Further, the
Board held that it was proper to use Claimant's actual earnings
with Employer, "less overtime paid for training and
inflation," as a "fair measure of his wage-earning
capacity." As noted by the Board, the record demonstrated
"that claimant's position will continue into the future and
is not sheltered employment." Thus, the Board held that
"the administrative law judge permissibly rejected
claimant's contention that if he lost his job he would not be
able to obtain the same type of job on the open market as too
speculative . . .."
In Kennedy v. American Bridge Co., ___
B.R.B.S. ___, BRB No. 92-1966 (Jan. 23, 1996)(per curiam), the
Board held that an injured worker satisfied the
"status" prong under § 2(3) as "an ironworker
hired to repair bridge segments contained on a barge adjacent to
a dock in New Jersey." Specifically, the Board concluded
that "the loading and unloading of construction materials
constitutes maritime employment" such that carrying tools on
and off a barge supports coverage under the Act. The Board also
noted that, as a matter of law, Claimant's work site, a barge
adjacent to a dock, satisfies the "situs" prong. Thus,
although Claimant suffered injury after falling off of a
gangplank and onto the dock, the gangplank was "used for
ingress and egress of a vessel." Therefore, regardless of
the location of Claimant's impact, jurisdiction is contingent
upon where "the injury causing incident was initiated."
Therefore, in this case, where "the incident resulting in claimant's broken elbows
commenced on a gangplank and ended upon claimant's impact with
the dock," Claimant was covered under the Act.
