Articles & Updates

First Mesothelioma Claim Decided Under the 2014 WC Amendments

by James B. Kennedy

On April 4, 2016 ALJ Mark Siedlik of the Kansas City Office of the Division of Workers’ Compensation issued an Award in Casey v. E. J. Cody Co, (Inj. No. 14-102671). This is, we believe, the first “occupational disease due to toxic exposure” case which has been decided under the amendments which became effective on January 1, 2014.

The salient facts are:

  • The employee was a career-long floor tile installer.
  • He retired in 1990 and the named employer was his last employer.
  • He was diagnosed with mesothelioma in 2014 and died of the disease in 2015.
  • His “last exposure” was predicated upon his being exposed to asbestos containing material which was still on the customers’ premises when he arrived to install new floor tile (which by then no longer contained asbestos).
  • The insured employer had accepted mesothelioma liability by virtue of a mesothelioma endorsement which was added to the policy which was in effect on the date of diagnosis
  • The claimants (wife and children) were only seeking the “enhanced benefit”, under Sec. 287.200.4, for permanent total disability or death due to mesothelioma.
  • There were fact driven disputes over exposure, medical causation, whether the employee contracted an occupational disease arising out of and in the course of his employment, and notice.
  • There were legal disputes over whether the new amendments applied to a claim involving employment and exposure that ended in 1990, whether the mesothelioma policy endorsement provided coverage for the mesothelioma benefit which was being sought in this case, and whether the application of the amendments to these facts violated the Missouri and/or U. S. Constitutions.

The ALJ found:

  • The employee contracted mesothelioma, an occupational disease which arose out of and in the course of his employment.
  • The employee was last exposed to the hazard of mesothelioma during his employment by the named employer.
  • The employer had notice of the occupational disease or was not prejudiced by any lack of notice.
  • The 2014 amendments fix an employer’s (and insurer’s) liability on the date of diagnosis.
  • The mesothelioma endorsement on its face provides coverage for the mesothelioma benefits when it refers to Sec. 287.200.4 and then states that: “Your policy provides insurance for these additional benefits”.
  • The policy contains a provision which states that if any policy terms conflict with the workers’ compensation law that the policy terms are changed to conform to the law.
  • The policy provision which states that in the case of an injury caused or aggravated by an exposure, that the exposure must occur during the policy period, is trumped by the endorsement, and even if an ambiguity in the policy provisions exist, that the ambiguity must be, under the law, resolved in favor of coverage.
  • The ALJ lacked jurisdiction to adjudicate the constitutionality of a Missouri statute.

Comments:

  • The Award will be appealed.
  • Of the 10 “occupational diseases due to toxic exposure”, only mesothelioma requires acceptance or rejection of liability by the employer and the inclusion of a corresponding policy endorsement.
  • The date of diagnosis in this case was after January 1, 2014, but what about claims where the date of diagnosis was prior to January 1, 2014?
  • And what if all salient events, accept for the filing of the Claim, predated the effective date of the amendments?
  • What if this employer had been an individual self-insurer or the member of a self-insurance trust?
  • This case is only the “first shot across the bow” in the coming battle over the 2014 occupational disease amendments.

Questions or comments: Contact jkennedy@evans-dixon.com, 314-552-4020

Copyright: Evans & Dixon, L.L.C., 2016