On July 18, 2014, the California 2nd District Court of Appeal in Benavides v. Specialty Risk Services, 2014 S.O.S. 3721, determined that an injured worker could reopen an award of permanent disability, though the parties had originally stipulated to the permanent disability, and though evidence of new and further disability arose from an examination that occurred before the stipulations. The Court of Appeal held the original stipulation of the parties was inequitable as it was based on incomplete evidence.
On February 7, 2005, Benavides fractured his low back and ankle when he fell from a roof. He was evaluated by an Agreed Medical Evaluator (“AME”) on April 12, 2007, and the doctor described him as remaining with a permanent disability based on the spinal fracture. On May 9, 2008, Benavides underwent an EMG study which revealed chronic left L5 radiculopathy. On July 23, 2008, the parties stipulated to an award of 51% permanent disability, relying on the AME’s April 2007 assessment of disability. Neither the AME or WCJ was aware of the EMG findings when the original award issued. When Benavides filed a timely Petition for New and Further Disability, he returned to the same AME for another assessment of the permanent disability. The doctor determined that the May 2008 EMG results warranted a greater level of permanent disability than was reflected in his April 2007 evaluation.
To reopen an award of permanent disability within 5 years of the date of injury under Labor Code §5410, there must be both new and additional disability that did not exist at the time of the Award. Additionally, Labor Code §5803 imbues the WCAB with continuing jurisdiction to rescind, alter or amend an award upon a showing of good cause. The court here accepted the long standing definition of good cause as being “newly discovered evidence previously unavailable, a change in law, or any factor or circumstance unknown at the time the original award or order was made which renders the previous award inequitable.” It further determined that an award may be reopened or rescinded if it was “entered into through inadvertence, excusable neglect, fraud, mistake of fact or law or where special circumstances exist rendering it unjust to enforce the stipulation.”
The court wrote that when Benavides filed the Petition to Reopen, “the evidence clearly established that the stipulated award was inequitable.” The court determined that the AME’s April 2007 report was incomplete without a review of the EMG findings. Therefore, the original stipulation was inequitable, because the medical report which it adopted was premised upon incomplete evidence.
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