W.C. No. 4-153-811Industrial Claim Appeals Office.
December 31, 1996
ORDER OF REMAND
The respondents seek review of an order of Administrative Law Judge Henk (ALJ) which awarded temporary total disability benefits while the claimant was unemployed between October 8, 1993 and July 11, 1995. The ALJ also imposed a penalty of $100 for the respondents’ failure to pay temporary disability benefits. We set aside the order, and remand for a new order.
The essential facts are undisputed. The claimant suffered a compensable back injury on June 23, 1992, while employed for Miller Brothers Inc. (Miller Brothers). On September 23, 1992 Miller Brothers terminated the claimant’s employment. From November 11, 1992 to October 8, 1993 the claimant worked for a waste management company. The claimant remained unemployed until May 5, 1994. Thereafter, the claimant held intermittent employment until July 11, 1995, the date of maximum medical improvement. Throughout the relevant period the claimant was subject to medical restrictions imposed in connection with the industrial injury.
In May 1994, the Colorado Compensation Insurance Authority filed a General Admission of Liability, in which the respondents admitted liability for temporary total disability benefits between September 23, 1992 and November 11, 1992. The claimant subsequently requested additional temporary disability benefits commencing October 8, 1993.
In view of the respondents’ General Admission of Liability, the ALJ determined that the respondents were obliged to pay continuing temporary total disability benefits until terminated in accordance with § 8-42-105(3)(a)-(d), C.R.S. (1995 Cum. Supp.) [subsection (d) amended 1996 Colo. Sess. Laws, ch. 173 at 827 for injuries occurring on or after July 1, 1996]. Further, the ALJ found that none of the events listed in §8-42-105(3)(a)-(d) occurred while the claimant was unemployed. Consequently, the ALJ determined that the claimant was entitled to temporary disability benefits for the periods of unemployment between October 8, 1993 and July 11, 1995. The ALJ also determined that the respondents’ failure to pay these temporary benefits was a violation of § 8-42-105(3). Therefore, the ALJ imposed a penalty of $100.
On appeal, the respondents rely upon PDM Molding, Inc. v. Stanberg, 898 P.2d 542 (Colo. 1995), and contend that they did not violate § 8-42-105(3) because the claimant was “at fault” for the September 23, 1992 employment termination, and Miller Brothers would have accommodated the claimant’s temporary medical restrictions, if the claimant had not been terminated for cause. Furthermore, the respondents’ assert that their May 1994 admission for temporary disability benefits was based upon the parties’ agreement to compromise disputed temporary disability between September 23, 1992 and November 11, 1992, without prejudice to the respondents’ PDM defense to their liability for further temporary disability benefits. Under these circumstances, the respondents contend that the ALJ’s order was error.
We conclude that the ALJ’s findings of fact are insufficient to permit appellate review of the respondents’ contention. Therefore, we set aside the order and remand the matter to the ALJ for additional findings of fact and the entry of a new order. Section 8-43-301(8), C.R.S. (1996 Cum. Supp.); Womack v. Industrial Commission, 168 Colo. 364, 451 P.2d 761 (1969).
To obtain temporary disability benefits the claimant bears the burden to prove a causal connection between the industrial injury and his temporary wage loss. Section 8-42-103(1), C.R.S. (1996 Cum. Supp.); J.D. Lunsford v. Sawatsky, 780 P.2d 76
(Colo.App. 1989). As argued by the respondents, PDM Molding, Inc., v. Stanberg, supra, stands for the proposition that where the claimant is “at fault” for the separation from modified employment during which the injury occurred, the termination severs the causal connection between the industrial injury, and the claimant’s subsequent wage loss. In PDM the Supreme Court stated that under such circumstances, there must be an “initial determination” concerning whether the “termination was for fault.” If the claimant is found to be “at fault,” PDM provides that the claimant is precluded from receiving further temporary disability benefits unless he proves that the industrial injury contributed “to some degree” to the post-termination wage loss.
In determining whether the claimant has sustained his burden of proof the ALJ may consider whether the employer would have provided modified employment had the claimant’s employment not been terminated for cause. In that event, the issue is whether the subsequent wage loss was, “to some degree,” caused by the injury. This is true because the claimant is not required to establish that the industrial injury is the sole cause of his wage loss. Rather, temporary disability benefits are precluded only when the work-related injury plays no part in the subsequent wage loss. Lindner Chevrolet v. Industrial Claim Appeals Office, 914 P.2d 496 (Colo.App. 1995); Horton v. Industrial Claim Appeals Office, ___ P.2d ___ (Colo.App. No. 96CA0284, November 29, 1996).
PDM also holds that if the claimant establishes a causal connection between the industrial injury and his post-termination wage loss, temporary disability benefits continue until the occurrence of one of the events listed in § 8-42-105(3)(a)-(d). As illustrated by the analysis i PDM, the determination of whether the claimant’s wage loss is causally connected to the injury must occurbefore deciding whether otherwise payable benefits should be “continued” or terminated under §8-42-105(3)(a)-(d).
In this case, the respondents admitted liability for temporary total disability between September 23, 1992 and November 11, 1992. However, the respondents’ General Admission of Liability provides for the payment of benefits at + of the claimant’s temporary disability rate, and states that the Admission is “per agreement between attorneys’, both parties to pay + of the temporary disability.” See (Tr. p. 5; Respondents Exhibit 1-1). Similarly, the record contains evidence that the Admission was filed pursuant to a settlement agreement in compromise of a disputed claim for temporary disability benefits between September 23, 1992 and November 11, 1992, without regard to the respondents’ liability for any subsequent period of temporary disability. (Tr. pp. 69, 109, 143, 152-153 see also January 13, 1995 correspondence from claimant’s attorney to the Division of Workers’ Compensation; and the CCIA).
This evidence is pertinent because the statutory duty to pay benefits “according to admitted liability” does not obligate an insurer to pay “continuing” temporary total disability benefits, where an Admission of Liability is filed pursuant to an agreement to pay benefits for a fixed period, and does not purport to resolve the insurer’s liability for any other benefits See § 8-43-203(2)(d), C.R.S. (1996 Cum. Supp.). Furthermore, an insurer is not required to voluntarily admit liability for temporary disability benefits if the insurer has a reasonable basis to deny liability. See Allison v. Industrial Claim Appeal Office, supra. Consequently, an insurer’s failure to voluntarily pay temporary disability benefits does not necessarily subject the insurer to penalties.
The ALJ made no oral or written findings concerning the circumstances surrounding the filing of the respondents’ General Admission of Liability. This was apparently based upon the ALJ’s erroneous conclusion that the respondents were required to voluntarily admit liability for the requested temporary disability benefits. Consequently, the ALJ’s findings are insufficient for us to ascertain whether the ALJ erred in finding that the respondents violated § 8-42-105(3).
In addition, the ALJ’s findings are insufficient to ascertain whether, under a PDM analysis, the claimant sustained his burden of proof for an award of temporary total disability benefits after September 23, 1992. Under these circumstances, we remand the matter to the ALJ to for a new order on the issues of temporary total disability and penalties.
For purposes of our remand, we also note that the ALJ did not explicitly indicate the legal basis for her penalty assessment. However, insofar as the ALJ imposed penalties under the statutory language currently codified at § 8-43-304(1), C.R.S. (1996 Cum. Supp.), this statute provides that the insurer is not subject to penalties for the violation of a rule or statute, unless the insurer’s actions which resulted in the violation were objectively unreasonable. Pueblo School District No. 70 v. Toth, 924 P.2d 1094 (Colo.App. 1996) cert. denied October 15, 1996; Colorado Compensation Insurance Authority v. Industrial Claim Appeals Office, 907 P.2d 676 (Colo.App. 1995). Based upon Tozer v. Scott Wetzel Services, Inc., 883 P.2d 496 (Colo.App. 1994), we have previously held that an insurer’s actions are not objectively unreasonable if predicated on a rational argument based in evidence or law. Halbritter v. Colorado Professional Counseling Services, P.C., W.C. No. 4-160-869, August 3, 1995, aff’d Colorado Professional Counseling Services, P.C., v. Halbritter (Colo.App. No. 95CA1356, June 6, 1996) (not selected for publication); Brown v. Gosney Sons, Inc., W.C. No. 3-104-140, August 30, 1994.
As a result of our disposition, it is premature to consider the respondents’ remaining arguments.
IT IS THEREFORE ORDERED that the ALJ’s order dated April 16, 1996, is set aside and the matter is remanded to the ALJ for entry of a new order consistent with the views expressed herein.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ David Cain
____________________________________ Kathy E. Dean
Copies of this decision were mailed December 31, 1996
to the following parties:
Michael J. Griffith, 4010 Valli Vista Road, Colorado Springs, CO 80909
Miller Brothers, Inc., 6540 Washington St., Denver, CO 80229-7013
Colorado Compensation Insurance Authority, Attn: Curt Kriksciun, Esq. (Interagency Mail)
Thomas E. J. Hazard, Esq., 1700 Broadway, Ste. 1700, Denver, CO 80290-1701 (For the Respondents)
Monte L. Skaggs, Esq, 115 E. Vermijo, Ste. 201, Colorado Springs, CO 80903 (For the Claimant)
BY: _______________________