Synopsis: Is the IL State Chamber Judicial Activism/Legislative “Inactivism” Report Fair or Unfair?
Editor’s Comment: We obtained and carefully read the seminal treatise from the IL State Chamber titled The Impact of Judicial Activism in Illinois—Workers’ Compensation Rulings from the Employer’s Perspective. We salute IL Chamber President Doug Whitley and Kathleen Bruns for drafting it. As we advised our readers last week, it is a “must-read” for all Illinois risk managers/claims handlers if you want to understand why our WC system is so challenging. If you want a copy of the report, surf to www.ilchamber.org; for clients of our firm, send a reply and we will get you a copy.
Our favorite passage is:
In conclusion, the essence of Illinois’ troubled workers’ compensation system is two-pronged (1) unfettered judicial discretion in interpreting the workers’ compensation law with the clear objective of expanding compensability of workers’ compensation claims; and (2) the failure of the Illinois General Assembly to pass legislation clearly expressing legislative intent and parameters of effectuation the provisions of the Act with the objective of ensuring the workers’ compensation system in Illinois is fair, predictable and benefits employers as well as injured workers.
We also read a quote from outgoing Illinois Workers’ Compensation Lawyers Association President Frank Sommario in www.workcompcentral.com where he says:
Whether WCLA members agree or disagree with a particular decision, we all agree that the Justices of the Appellate and Supreme Courts are diligent and hard-working judges, who apply the law impartially to the facts presented to them and who handle these extra workers’ compensation duties voluntarily in addition to their regular caseload.” Sommario said, “in our view, it is extremely unfair for the Chamber to draw such broad negative conclusions based on 17 cases out of the over 1,000 workers’ compensation cases that were decided by the Appellate and Supreme Courts during the period covered by the Chamber report.
We want to reply to highly respected WCLA President Sommario with our three different concerns/objections. First, IL Supreme and Appellate Court justices are among the best paid in the United States with guaranteed annual pay raises and generous pensions that also go up every year. We are certain they are diligent and hard-working and thank them for their intelligence, dedication and service.
As to the 17 cases out of a thousand being analyzed by the State Chamber report, we point out the IL State Chamber review analyzed the biggest cases—they looked at the rulings that formed the other 983 cases considered during the period of their analysis. By that we mean, prior to the E.R. Moore v. Industrial Commission ruling, IL WC didn’t have “odd lot” total and permanent disability claims. The IL WC Act doesn’t have an definition for the words “odd lot.” Due to the lack of a definition or any mention of the term, one could infer our legislature didn’t intend to provide the rights or responsibilities that come with this very, very expensive lifetime, tax-free benefit. The IL Supreme Court and Appellate Court rulings that create new laws like this foster ambiguity that generates more and not less certainty in what is supposed to be a simple and easy-to-understand area of benefits.
For an even better example, in the words of the IL State Chamber report, when our “unfettered” reviewing courts judicially “create” a legal concept, we are all left to guess what they mean by it. That generates lots more litigation to delve into the boundaries of the new hypothesis. For one simple example, the 1990 Edward Hines Lumber ruling judicially added overtime to the IL average weekly wage in contradiction to what we feel is the simple language in Section 10 of the Act. That ruling led to a 1996 decision named Ogle v. IIC which led to the Edward Donruling in 2003 which led to Freesen, Inc. v. IIC in 2004 with the most current statement in this line of overtime rulings being the 2007 decision in Airborne Express v. IWCC. At present, IL workers are required to demonstrate overtime has to somehow be “mandatory” which is another term not defined in Section 10 of the Act.
Regardless of your feelings about this plethora of rulings, our point is judicial activism creates more judicial involvement. As the IL State Chamber report accurately notes the IL General Assembly then effectively sits on their hands and does nothing to provide any guidance as to what to do about the new judicial models.
Aside from the new and unprecedented “traveling employee” concept, perhaps the simplest and most controversial legal ruling from an reviewing court your editor has ever read is Durand v. IWCC. In Durand, the worker admitted she suffered from carpal tunnel for four years and the IL WC Act required her to file the Application within three years—she admitted she didn’t do so. If you teach any schoolchild the law, it is our view such a claim should be denied 100 out of 100 times. We simply don’t see any “wiggle-room” or a path around the clear statutory language. In considering the facts of the claim, our highest court wrote they weren’t going to “punish” her for supposedly working with pain until the statute of limitations ran. What worker couldn’t make the claim they “worked with pain?” If you aren’t certain, such a ruling eviscerates the plain language in Section 6 of the IL WC Act. As court-watchers, we now have literally no idea when and how the statute of limitations might apply moving forward but we can be certain there may be lots more litigation over this previously simple and straightforward provision of the Act.
Our problem with that ruling and the 16 other such rulings outlined in the IL Chamber Report is they distill the frustration of all Illinois businesses in dealing with the ostensibly simple system of workers compensation benefits—the law is the law; if you follow the simple rules, you get what the law provides.
Please also remember the new Chief Justice of the IL Supreme Court is the revered Rita Garman who is a Republican. To the extent the Court she now leads picks the five-member Appellate Court, Workers’ Compensation Division, as a voice for Illinois business, we would love to see some new blood on this five-member panel with at least one or two members who have a strong pro-business focus. It is our opinion all five members of the current panel are excellent and knowledgeable jurists but not one of them strictly construes the IL WC Act or has a strong business focus. It is our reasoned opinion they all speak with a single voice of judicial activism in the interests of Illinois labor. It has been literally decades since there was a member of this panel that wrote a strong dissent.
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Synopsis: Yes, Folks, Lung Cancer, Cigarette Smoking and Lots of Personal Conditions and Bad Habits are Now Work-Related But Only For “Travelers.”
Editor’s comment: We had many long-time readers object to our conclusion in last week’s lead article. They assert the personal and bad habit of cigarette smoking cannot possibly be work-related for the millions of workers who now fit the wildly expanded definition of “traveling employees.” The main objection from our readers was the deleterious condition has to be “causally connected” in a fashion our courts aren’t requiring.
Four Appellate Court, Workers’ Compensation Division rulings, several of them now final, find IL employers now owe for all “reasonable and foreseeable” activities of “travelers.” We note the first case remains pending before the IL Supreme Court and was orally argued more than six weeks ago. We hope for a ruling from the Court by the end of this year.
In Admiral Mechanical v. IWCC, the Appellate Court ruling says:
The traveling employee retains the burden of proof regarding causation. Hoffman v. Industrial Comm’n, 109 Ill. 2d 194, 199 (1984). That burden is met where the employee shows his or her conduct was reasonable and foreseeable. Cox, 406 Ill. App. 3d at 545-46.
In Venture-Newberg-Perini Webster & Stone v. IWCC, Claimant Ron Daugherty’s actions leading to injury were sitting in a car seat while his buddy was driving. Now his employer is on the hook for all his personal and non-work-related medical issues effectively for life. By the time of the hearing, he had over $1M in medical bills. If/when he passes, it will almost certainly be due to related problems and multi-million-dollar death benefits will be due.
· Let’s assume Ron Daugherty was not in a car but riding as a passenger on a motorcycle. Riding on a motorcycle is “reasonable and foreseeable.” The same accident would clearly be compensable under the same theories.
· Let’s assume the same motorcycle didn’t crash but went over a lot of hard bumps and he developed intractable low back pain. Despite the absence of a “work-related accident,” the court’s new rulings make such “repetitive-trauma” back pain with medical care and lost time and permanency the responsibility of the employer, even though the true cause has literally nothing to do with work.
· Let’s assume he was riding on a motorcycle and got bit by a West Nile mosquito which is a risk common to everyone. If all he has to do is prove his actions in riding the bike are “reasonable and foreseeable” he is entitled to full WC benefits.
· Let’s further assume he was riding as a passenger on a motorcycle and didn’t dress properly for a cold November day. He develops pneumonia from riding on the motorcycle and his doctor said the lack of proper clothing caused the pneumonia. The new rulings make that illness and its sequalae the responsibility of the employer. Medical care, lost time and permanency would be due. If he were to pass from that now-compensable medical condition, it would clearly be a death claim.
Under the same reasoning, bad personal habits like smoking cigarettes, texting while driving, not dressing properly to account for cold or rainy weather, wearing six-inch high heels or other unsafe personal footwear, smoking in bed and lots of other unsavory or questionable personal activities are “reasonable and foreseeable,” causally connected to work and compensable. All such activities are now compensable for “travelers”—at the same time, there is no such coverage for “non-travelers.”
As a challenge to our readers, if you feel the IL employer is not responsible for everything a “traveler” does from when they leave their house until they return including bad/dangerous personal habits and bad clothing, you tell us what is and isn’t “causally connected.”
Please note all prior legal definitions of “traveling employees” are about business people on business trips where the employer is paying them for foreign travel and reimbursing expenses. Ron Daugherty, Stanislawa Mlynarczyk and the other folks recently found to be “travelers” were injured off the clock and miles from their jobs. They weren’t being paid expenses or compensated during travel.
In our view, this state can’t possibly make employers responsible for injuries, illnesses and deaths for personal risks and bad habits. It doesn’t make sense and can’t be made to make sense. If you want to be mad at us for talking about it, go ahead but we aren’t causing this impossible-to-sustain concept.
We appreciate your thoughts and comments.
Synopsis: The Illinois Appellate Court Bars Defendant from Contribution/Indemnification claims in a later suit when such claims should have been alleged in the initial lawsuit filed by an injured worker. Analysis by Matt Ignoffo, J.D., MSCC.
Editor’s Comment: The underlying facts in Camper v. Burnside Construction involve Michael Camper, an employee of Neptune Construction, who fell and sustained injuries while working in a sanitary manhole on a construction site in Elgin, Illinois during January 2006. (No. 1-12-1589, October 28, 2013). Camper filed a four-count complaint against general contractors Burnside and Welch (Camper I). In Camper I, Camper alleged causes of action for construction negligence (count I) and premises liability (count II) against Burnside, and alleged two counts of product liability against Welch, as manufacturer of the manhole, under the theories of strict liability (count III) and negligence (count IV). Welch filed a third-party action for contribution against Neptune under the Joint Tortfeasor Contribution Act.
Camper settled his claims against Burnside and Neptune. The settlement agreement stated that Neptune agreed to waive its claim for reimbursement under the Workers' Compensation Act (the WC lien). The court's February 13, 2009 order expressly stated the settlement between Camper, Burnside, and Neptune was made in good faith pursuant to the Joint Tortfeasor Contribution Act; that Camper's action against Burnside, and Welch's third-party action against Neptune, were dismissed with prejudice; and that the court "bars any actions for contribution by any other defendants or tortfeasors against Burnside or Neptune." Camper's cause of action against Welch was to continue on as Welch was the sole non-settling defendant in Camper I.
On April 22, 2009, Camper voluntarily dismissed his complaint against Welch without prejudice. On February 5, 2010, Camper refiled his cause of action against Welch only, by alleging the same two counts of product liability based on strict liability (count I) and negligence (count II) (Camper II). On May 19, 2010, Welch filed a two-count third-party action, seeking contribution (count I) and "indemnification/breach of contract" (indemnification claim) (count II) against Neptune. Neptune filed a section 2-619 motion to dismiss Welch's third-party complaint for contribution and indemnification on the basis that the claims were barred by res judicata.
In separate orders the Circuit Court dismissed Welch’s contribution (count I) and indemnification (count II) claims against Neptune and Welch appealed.
Under section 2-619 of the Illinois Code of Civil Procedure, an action may be involuntarily dismissed on the bases that "the cause of action is barred by a prior judgment" under a theory of res judicata, or that "the claim asserted against the defendant is barred by other affirmative matter avoiding the legal effect of or defeating the claim." The doctrine of res judicata provides that a final judgment on the merits rendered by a court of competent jurisdiction bars any subsequent actions between the same parties or their privies on the same cause of action. Three requirements must be satisfied in order for res judicata to apply:
1. a final judgment on the merits has been reached by a court of competent jurisdiction;
2. an identity of cause of action exists; and
3. the parties or their privies are identical in both actions.
Res judicata bars not only what was actually decided in the first action, but also those matters that could have been decided in that lawsuit.
With regard to Welch’s contribution claim (count I) against Neptune the Court only needed to decide the “on the merits” requirement as the second and third requirements were satisfied here. It noted, generally orders dismissing an action with prejudice constitutes a final judgment on the merits for the purposes of res judicata.
Welch's original third-party contribution claim in Camper I was dismissed for a reason other than for lack of jurisdiction, improper venue, or failure to join an indispensable party. The Court found the February 13, 2009 dismissal with prejudice of Welch's Camper I third-party contribution action against Neptune was an "involuntary" dismissal and, thus, operated as an adjudication upon the merits. Camper's settlement with Burnside and Neptune in Camper I was a final judgment on the merits for the purposes of res judicata, where the parties agreed to a resolution and the Circuit Court dismissed with prejudice Camper's action against Burnside and Welch's original contribution claim against Neptune.
With regard to Welch’s indemnification claim (count II) against Neptune, as the “on the merits” requirement was now met and the identical parties requirement was met the Court only needed to determine whether the indemnification claim (count II) sought by Welch in Camper II has an "identity of cause of action" with the contribution claim sought by Welch in Camper I.
Illinois applies the more liberal "transactional test" in determining whether identity of cause of action exists for the purposes of res judicata. Under the transactional test, separate claims will be considered the same cause of action for purposes of res judicata if they arise from a single group of operative facts, regardless of whether they assert different theories of relief. To determine whether there is an identity of cause of action between the first and second lawsuits, a court must look to the facts that give rise to plaintiff’s right to relief, not simply to the facts which support the judgment. An identity of cause of action is established if two claims are based on the same, or nearly the same, factual allegations.
Welch argued the Camper I contribution action was a cause of action arising out of potential tort liability, while the Camper II indemnification claim was based upon contract liability. Welch further asserted the contribution claim and the indemnification claim relied upon two different sets of factual allegations for support.
The Court held regardless of the fact Welch's contribution claim in Camper I and the indemnification claim in Camper II assert different theories of relief against Neptune, both actions relied upon the circumstances surrounding Camper's accident. Welch's Camper II indemnification claim against Neptune arose from the same group of operative facts as its Camper I contribution action against Neptune. Both actions arose out of the injuries suffered by Camper when he allegedly fell while working. As all three elements of res judicata were satisfied the Court held the indemnification claim (count II) was barred. The Circuit Court judgment was affirmed.
We can learn from this holding that any and all claims need to be addressed prior to settlement agreements and orders being entered. Claims should be alleged as early as possible or they may be barred. Extensive litigation was pursued in this matter in an attempt to bring claims which likely had value, but procedural issues precluded them from being heard by a trier of fact.
This article was researched and written by Matthew Ignoffo, J.D., M.S.C.C. Please feel free to contact Matt at firstname.lastname@example.org.