Indiana Law Review


1995 Developments in Worker's Compensation

Gregory M. Feary*
Steven A. Pletcher*'

Introduction

This Article surveys the developments in Indiana's Worker's Compensation

law during 1995. The Article reviews a wide variety of cases and issues affecting
Indiana practitioners. Areas of special significance include the apportionment

statute's definition of disability, the statute of limitations for modifications of

awards, and challenges to the Worker's Compensation Act's exclusive remedy.

I. In the Course of and Arising Out of

A. Construction Management & Design, Inc. v. Vanderweele

"To recover under the Act, a claimant must establish that an injury or death
occurred 'by accident arising out of and in the course of employment.'"

1

In

Construction Management & Design, Inc. v. Vanderweele, 1 Vanderweele was a
construction worker who, while working at a home under construction, noticed
that a van on the adjacent property's driveway began to spin its wheels causing it

to slide off the driveway. Vanderweele slipped and fell while walking down the
adjacent property's driveway in his attempt to help the driver. The Indiana Court

of Appeals was asked to review the decision of the Worker's Compensation Board

(the "Board") chaired by G. Terrence Coriden. The Board had affirmed the

hearing member's decision finding that Vanderweele's head injury of February 15,
1 994 arose out of and in the course of his employment. The court of appeals
enunciated the two factors that must be present in order for a worker's

compensation claim to be found compensable under Indiana's Worker's

Compensation Act. First, the injury must be "in the course of employment," and

second, it must be "arising out of employment."
3

The court of appeals explained that the question of whether an injury arises
out of and in the course of employment is typically fact-sensitive.

4
However,

when there are stipulated facts to which both parties agree, as in this case, the

* Partner, Scopelitis, Garvin, Light & Hanson. B.S., 1979, Eastern Illinois University;
J.D., 1988, Indiana University School of Law—Indianapolis.

** Associate, Scopelitis, Garvin, Light & Hanson. B.S., 1986, Indiana University—South
Bend; J.D., 1991, Valparaiso University School of Law.

1. Rogers v. Bethlehem Steel Corp., 655 N.E.2d 73, 75 (Ind. Ct. App. 1995) (citing Ind.

Code § 22-3-2-2 (1993); Evans v. Yankeetown Dock Corp., 491 N.E.2d 969, 973 (Ind. 1986)).

2. 660 N.E.2d 1046 (Ind. Ct. App. 1996).

3. The court of appeals was required to undergo the same fundamental analysis in four

other cases decided in 1995. However, the Vanderweele case provides the most thorough analysis.

4. Vanderweele, 660 N.E.2d at 1049 (citing Burke v. Wilfong, 638 N.E.2d 865 (Ind. Ct.

App. 1994)).



1 140 INDIANA LAW REVIEW [Vol. 29:1139

court considers the question to be "one of law."
5 The "in the course of

employment" factor refers to where, when and how the accident occurs. The
Vanderweele court explained that "an accident occurs in the course of employment
when it takes place within the period of employment, at a place where an
employee may reasonably be, and while fulfilling the duties of employment or is
engaged in doing something incidental thereto."

6 The court cited Thiellen v.
Graves

1
for an illustration of the "in the course of employment" test. In that case,

Thiellen was injured while leaving the employer's premises on his motorcycle.
Although Thiellen was no longer engaged in his work duties, he was still upon the
premises of his employer when he was injured and was found to be in the course
of his employment at the time of his injury. Thus, the Thiellen case lent further
support to preexisting case law defining the employer's boundaries as the point at

which its worker's compensation liability ends,
8
unless one of two factual

exceptions exists.
9

Under the first exception, liability extends beyond the employer's boundaries
when the employee may reasonably be found there as part of his job duties. 10

Under the second, liability extends when activities incidental to employment
duties result in injury while the employee is beyond the employer's boundaries,

such as when an injury occurs to an employee engaged in acts that "are necessary
to the life, comfort, and convenience of the workman, while at work, though

personal to himself, and technically not acts of service . . . ."
n

The Vanderweele

court concluded that Vanderweele was not reasonably expected to be upon the

adjacent driveway and his being there was not incidental to his employment.

Consequently, Vanderweele 's off-premises injury did not "fit within any of the

recognized exceptions to the requirement that the injury occur[] on the employer's

premises . . . ."
12

Having reached the conclusion that Vanderweele' s injury did not occur in the

5. Id. (citing Lowell Health Care Ctr. v. Jordan, 641 N.E.2d 675 (Ind. Ct. App. 1994)).

6. Id. (citing Burke, 638 N.E.2d at 868 (quoting Wayne Adams Buick, Inc. v. Ference, 421

N.E.2d 733, 735 (Ind. Ct. App. 1981))).

7. 530 N.E.2d 765 (Ind. Ct. App. 1988).

8. Vanderweele, 660 N.E.2d at 1050. The court quotes Markley v. Richmond Glove Corp.,

156 N.E.2d 407, 413 (Ind. App. 1959) (stating that "[t]his rule provides a definite standard by

which liability can be determined").

9. A thorough discussion of the two exceptions can be found in Wayne Adams Buick, Inc.

,

421 N.E.2dat733.

10. Vanderweele, 660 N.E.2d at 1050. See also Markley, 156 N.E.2d at 41 3.

11. Vanderweele, 660 N.E.2d at 1050 (citing Praeter v. Briquetting Corp., 251 N.E.2d 810,

812-13 (Ind. Ct. App. 1961) (quoting Holand-St. Louis Sugar Co. v. Shraluka, 1 16 N.E. 330, 331

(Ind. App. 1917))). Although the court indicates that activities "incidental" to employment

occurring off the employer's premises still remain "within the course of employment," the quote

specifically states "an accident occurring in the performance of such acts is deemed to have arisen

out of the employment." Id. (emphasis added). This suggests some overlap in the "in course of
and "arising out of tests in the area of acts incidental to employment.

12. Id.



1996] WORKER'S COMPENSATION 1 141

course of employment, the court nevertheless identified an additional factor to be

considered in making "in the course of determinations. The factor can be
described as the circumstantial factor wherein a court must look to the

"circumstances of the accident"
13

(i.e., what was the employee doing at the time

of the accident?). If the employee is either engaged in his employment duties or
activity incidental thereto, the injury would be in the course of employment

regardless of where the injury occurred. This circumstantial factor appears to

essentially restate the second exception to the rule that injuries must occur on the

work premises during normal work hours to be considered in the course of
employment. Moreover, its focus upon the employee's activity tends to blur the

distinction between the "in the course of employment" prong and the "arising out

of employment" prong.

Although the Vanderweele court concluded that Vanderweele's injury did not

occur in the course of employment, it also went on to consider the "arising out of

employment" criteria.
14

The court stated "[f]or an accident to arise out of
employment, there must be a causal relationship between the employment and
injury. Such a connection is established when the accident occurs out of a risk
which ... a reasonably prudent person might comprehend as incidental to the

work."
15

Vanderweele argued that goodwill brought about by his charitable act

would inure to the benefit of his employer and thus would be incidental to his

employment. Although the hearing judge and the Board were persuaded by this

argument, the court rejected it stating that "such an amorphous and speculative

benefit can[not] by itself supply the required nexus between the accident and the

employment so as to confer coverage under the Act."
16 The court called upon its

analysis used in KCL Corp. v. Pierce}1 reasoning that the employee must "owe a
duty that is reasonably considered to be required by the employment or incidental
thereto."

18

The Vanderweele case provides a comprehensive analysis of the two-pronged
"in the course of and "arising out of test of compensability, however, the court
of appeals addressed one or both of the prongs as key issues in several other cases

during 1995. For example, in Lawhead v. Brown, 19 the court found Brown's
injury of March 29, 1994, occurring in his employer's parking lot after work
hours, to be in the course of employment.

20 The court also found Brown's injury
to arise out of employment because injuries occurring during the time an employee

13. Id.

14. Id.

15. Id. (quoting Thiellen v. Graves, 530 N.E.2d 765, 767 (Ind. Ct. App. 1988)).

16. Id.

17. 226 N.E.2d 548 (Ind. App. 1967) (a case factually similar to the Vanderweele case

involving an employee injured while pushing a car out of snow after work).

1 8. Vanderweele, 660 N.E.2d at 105 1

.

19. 653 N.E.2d 527 (Ind. Ct. App. 1995).

20. Id. at 529. The court cited Blaw-Knox Foundry & Mill Mach., Inc. v. Dacus, 505
N.E.2d 101, 102 (Ind. Ct. App. 1987), and determined that "the course of employment includes the

time that employees are on the employer's premises and are going to and leaving the work place."



1 142 INDIANA LAW REVIEW [Vol. 29:1 139

is leaving work are incidental to or related to employment.
21

In other words, there

is a causal relationship between the employment and the injury under such
circumstances.

B. Tippmann v. Hensler

Again, in Tippmann v. Hensler,
22

the court of appeals considered the two-

pronged test for compensability under the Act. Importantly, as Tippmann
illustrates, activities that may not appear to be causally related to employment may
nevertheless arise out of employment if the employer acquiesces to such activities

when the activities are common occurrences of which the employer has
knowledge.

23

In the Tippmann case, Hensler received an eye injury on October 19, 1990,
when Tippmann and Hensler were firing paint guns in a paint booth while on a
work break. Tippmann, as a prank, intentionally fired a paint gun at Hensler
causing his eye injury.

24
Even though Hensler was on a work break, the court

found that his injury was in the course of employment holding that "[a]ccidents

occurring in the performance of acts that are reasonably necessary to the life and

comfort of a workman, although personal, are incidental to employment and
compensable under the Act."

25
Although the court found Hensler to be in the

course of employment despite being on a work break at the time of the injury, the
circumstances of the injury gave rise to a question of causal connection between

the activity causing the injury and Hensler' s employment.
26 The facts before the

court were insufficient to enable the court to determine whether a causal nexus

existed to support a finding that Hensler' s injury arose out of his employment.

However, the court cited its decision in Weldy v. Kline
21

as an indication of its

final ruling in this case depending upon the factual findings of the trial court as to

whether Hensler was engaged in horseplay.

The court acknowledged that "[i]n instances where horseplay is a common
occurrence and the employer, with knowledge of the facts, permits the practice to

21

.

Lawhead, 653 N.E.2d at 529.

22. 654 N.E.2d 821 (Ind. Ct. App. 1995).

23. Id. at 826.

24. The court briefly reviewed a "long standing rule in Indiana" that even if an injury is

intentional it is still considered "by accident" pursuant to Ind. Code § 22-3-2-6 (1993). Tippmann,

654 N.E.2d at 825; see also Perry v. Stitzer Buick GMC, Inc., 637 N.E.2d 1282 (Ind. 1994); Baker

v. Westinghouse Elec. Corp., 637 N.E.2d 1271 (Ind. 1994).

25. Tippmann, 654 N.E.2d at 825 (citing Evans v. Yankeetown Dock Corp., 491 N.E.2d

969, 976 (Ind. 1986)).

26. Although the facts before the court were insufficient to make a final determination, the

court cited Nelson v. Denkins, 598 N.E.2d 558, 562 (Ind. Ct. App. 1992), and explained as follows:

"Moreover, this court has determined that work related disputes and disagreements are

consequences that arise out of and in the course of the employment relationship." Tippmann, 654

N.E.2d at 825.

27. 616 N.E.2d 398 (Ind. Ct. App. 1993).



1996] WORKER'S COMPENSATION 1 143

continue, he has acquiesced in the horseplay, and it becomes a condition of

employment."
28 The court explained that such a situation "satisfies the causal

nexus between the injury and the performance of some service of the employment

by demonstrating that the accident arose out of a risk which a reasonable person

might have comprehended as incidental to the employment at the time of entering

into it."
29 On the other hand, the court noted that if Hensler was an active

participant in horseplay, his injury would not have been considered as arising out

of employment because the horseplay would be an intervening cause between

activities otherwise incidental to his employment and the injury.
30

C. Rogers v. Bethlehem Steel

The court addressed the "arising out of prong as the sole issue in Rogers v.
Bethlehem Steel

3]
and in so doing provided an analytical approach to examining

whether a "causal nexus exist[ed] between the injury sustained and the duties or

services performed by the injured employee."
32 The determination of a causal

nexus does not always lend itself to a clear and cogent thought process,

particularly when counsel must advise the client as to whether an injury arose out
of employment. However, categorizing the "risk" leading to the injury may, in

some circumstances, provide the analytical tool necessary to aid counsel in the role

of advisor.

In Rogers, Joseph Rogers was murdered by a co-employee of Bethlehem Steel

Corporation in September of 1992. Gary Moore, the co-employee, may have
borrowed money from Rogers who "was known to carry a large sum of money and
. . . loaned money to various persons in the past . . . ."

33
Witnesses testified that

Moore had engaged in arguments with Rogers of a personal nature prior to
Rogers's murder. The court observed that Rogers's penchant for carrying and
lending large sums of money was not a condition or requirement of his job but
rather a "risk personal to himself . . . ,"

34 As a result, the court held that Rogers's
widow's worker's compensation death benefit claim was not compensable because

the injury causing his death "did not arise out of his employment with Bethlehem

28. Tippmann, 654 N.E.2d at 826.

29. Id.

30. Id. Although the court recites a long standing factor in determining whether an injury

resulting from horseplay is compensable (i.e., whether the employer had notice of the horseplay and

acquiesced), there is some question whether this factor is applied in making such a determination.

Rather, the key factor appears to be whether the injured employee was an innocent victim or active

participant in the horseplay. The employer's knowledge and acquiescence appears to be presumed

in cases involving an innocent victim. See Chicago, I. & L. RY. Co. v. Clendennin, 143 N.E. 303
(Ind. App. 1924). Also, the employer's knowledge is irrelevant in cases involving active

participants. See Weldy v. Kline, 652 N.E.2d 107 (Ind. Ct. App. 1995).

31. 655 N.E.2d 73 (Ind. Ct. App. 1995).

32. Id. at 75.

33. Id. at 74.

34. Id. at 76.



1 1 44 INDIANA LAW REVIEW [Vol. 29: 1 1 39

Steel."
35

The categories of risk the court used to determine whether the injury was one
arising out of employment were as follows:

(1) Risks distinctly associated with the employment;

(2) Risks personal to the claimant; and

(3) Neutral risks which have no particular employment or personal
character.

36

The court, following its analysis in Peavler v. Mitchell & Scott Machine Co.?1

indicated that categories one and three were risks covered by the Worker's

Compensation Act, but category two risks were not compensable.
38

Although in some factual situation it may be difficult to determine if the injury
was caused by a risk personal to the claimant, Rogers and Moore were observed
by others as involved in a personal dispute over a personal loan, which clearly fell

into category two and was not compensable. Suffice it to say, the rule and

exceptions defining the "in the course of employment" prong are less troublesome

to counsel than the more amorphous determination as to whether an injury meets

the causal nexus criteria of the "arising out of employment" prong.

n. Agricultural Exemption: Viability of Exemption

The Indiana Supreme Court in Collins v. Day39 addressed the constitutionality
of the provision within Indiana's Worker's Compensation Act exempting

agricultural employers and their employees from coverage under the Act.
40

The
Privileges and Immunities Clause of the Indiana Constitution prohibits the

granting of privileges or immunities to any citizen if they are not also granted

equally to all citizens.
41

In many respects, this provision is analogous to the Equal
Protection Clause of the Fourteenth Amendment of the United States Constitution.
Indiana courts have regularly applied the same analytical methodology used by

federal courts and applied the "rational basis" standard to determine if a provision

35. Id.

36. Id. at 75 (citing K-Mart Corp. v. Novak, 521 N.E.2d 1346, 1349 n.l (Ind. Ct. App.

1988); 1 Arthur Larson, Workmen's Compensation Law §§ 6.50, 1 1.30 (desk ed. 1995);
Peavler v. Mitchell & Scott Mach. Co., 638 N.E.2d 879, 881 (Ind. Ct. App. 1994)).

37. 638 N.E.2d 879 (Ind. Ct. App. 1994).

38. Rogers, 655 N.E.2d at 75-76.

39. 664 N.E.2d 72 (Ind. 1994).

40. Ind. Code § 22-3-2-9 (1993). This section not only exempts agricultural employers and

employees from worker's compensation coverage, it also exempts casual labor and domestic

servants but allows the employers of these employees to waive the exemption and accept coverage

by giving notice in writing to the employee.

41. Ind. Const, art. I, § 23.



1 996] WORKER'S COMPENSATION 1 1 45

of Indiana law violates Indiana's Constitution.
42

However, the Collins court

concluded that there was no "settled body of Indiana law" requiring the court to

use the same analytical method that courts used in determining federal

constitutional questions under the Fourteenth Amendment. Thus, the court
applied an "independent interpretation and application" to develop a separate

standard applicable to questions arising under Indiana's Privileges and Immunities

Clause.
43

The separate standard had been distilled by the court in past cases when it did
not apply a Fourteenth Amendment analytical approach. The standard consists of
"two general factors."

44
The first factor requires the existence of a separate

identifiable class and that the class distinction be inherent and related to the

"'subject-matter of the legislation which require[s] . . . exclusive legislation with

respect to the members of the class.'"
45

The second factor requires "equal
availability of the preferential treatment for all persons similarly situated."

46

In applying the two general factors, the Collins court observed that agricultural

employers and employment, at least historically, consisted of small, often family-

owned, businesses with little in the way of employee benefits, worker training or
formality in the employment relationship. Moreover, farmers were not easily able

to pass on the high cost of worker's compensation insurance to their customers.
47

Thus, the court concluded that there was a distinct identity to the agricultural

employer class that was inherent to the subject matter of the worker's

compensation exemption for agricultural employers. The court also found the
exemption to be available to all agricultural employers, thereby satisfying the

second factor of the court's constitutional analysis under Indiana's Privileges and

Immunities Clause.

Although an amicus brief submitted by the Legal Services Organization of

Indiana provided a "forceful, thorough, and well-documented" argument

indicating that the exemption no longer applied to current social or economic

conditions of the agricultural business in Indiana, the court stated that the

"plaintiff ha[d] failed to carry the burden placed upon the challenger to negative

every reasonable basis for the classification."
48

Consequently, the court did not

find that the agricultural exemption violated Indiana's Privileges and Immunities

Clause.

An additional question raised by the plaintiff in Collins was whether allowing
the employer the right to waive the exemption improperly provided a privilege to

the employer that was not granted to the agricultural employee.
49

The court

concluded that the waiver provision did not violate the Privileges and Immunities

42. Collins, 664 N.E.2d at 74.

43. Id. at 75.

44. Id. at 78.

45. Id. (quoting Heckler v. Conter, 381 N.E. 878, 879 (Ind. 1933)).

46. Id. at 79.

47. Id. at 81.

48. Id.

49. See IND. CODE § 22-3-2-9(b) (1993).



1 1 46 INDIANA LAW REVIEW [Vol. 29: 1 1 39

Clause of Indiana's Constitution because there was a rational basis for providing
the privilege to the agricultural employer and not the employee. The court implied
that the basis for the exemption was related to the business of farming in the
Indiana business environment. In that regard, employers were responsible for the

"management decisions" governing the operation of the agricultural business.50

To allow each employee to elect coverage or not would result in inconsistency in
a business in which employees tended to be transient.

For the time being, the agricultural exemption remains viable. The court's
emphasis on the Legal Services Organization's amicus brief suggests that a future

case arguing this issue may have the opposite result due to substantial change in
Indiana's agricultural industry.

HI. Discovery: The Board's Discretionary Power

In Drew v. Quantum Systems, Inc., 51 the Indiana Court of Appeals was
presented with two issues regarding the Board's authority and the proper exercise

of discretion in its use of such authority. In Drew, the Board dismissed a claim for

benefits as a sanction for Drew's failure to comply with the Board's order

compelling Drew to submit a timely response to Quantum Systems'
interrogatories. Although Drew initially argued that the Board was without
authority to dismiss his claim as a sanction for his delinquent response, he

conceded the Board's authority pursuant to Indiana Trial Rule 37, which is

incorporated into the Board's administrative rules under Indiana Administrative

Code, Title 631, Rule 1-1-3.
52

Drew's argument focused on what he characterized as the Board's abuse of

its discretion in imposing such a harsh sanction. Drew's contention was that,

because he eventually answered Quantum Systems' interrogatories and did not
have a long history of evading discovery, the Board abused its authority by

dismissing his claim. The court disagreed with Drew and identified guidelines
previously stated in Burns v. St. Mary Medical Center, 51, indicating that a
"[dismissal [was] not unjust where (1) the party was given additional time within

which to respond and was expressly warned that failure to respond would result

in dismissal and (2) no response or motion for additional time was timely made
and no reason excusing a timely response [was] demonstrated."

54

Drew failed to respond to Quantum Systems' interrogatories for nearly four
months from the October 25, 1993 date upon which he was originally requested

50. Collins, 664 N.E.2d at 82.

51. 661 N.E.2d 594 (Ind. Ct. App. 1996).

52. Id. at 595. The issue of the Board's authority was not an issue of lengthy debate. The

court merely confirmed the parties' acknowledgment of the Board's authority stating as follows:

"It is well established that the Board has the authority to order parties to comply with discovery

requests. Available sanctions for failure to comply with discovery orders under T.R. 37 include

dismissing the action." Id.

53. 504 N.E.2d 1038, 1039 (Ind. Ct. App. 1987).

54. Drew, 661 N.E.2d at 595.



1 996] WORKER'S COMPENSATION 1 1 47

to respond. Drew did not respond to the motion to compel that was filed by
Quantum Systems on February 22, 1994, and he did not request an extension of
time. Thus, the Board ordered him to respond, but two months later he had not

done so. On May 31, 1994, the Board ordered the case dismissed, but allowed
Drew twenty days to show cause as to why the dismissal should be set aside. 55

Drew filed his response to the Board's "show cause" order two days late and
indicated he would respond to the interrogatories within two weeks. Nevertheless,

Drew did not answer the interrogatories for another two months.
Drew's repeated failure to respond or even comply with his own

representation of when he would respond provided ample justification for the
Board's proper use of its discretionary authority to dismiss Drew's claim. The
Drew case highlights the importance of discovery in worker's compensation cases.
The Board clearly has the discretionary authority to dismiss a claim or otherwise
take appropriate action under law.

56

IV. Permanent Total Disability: Case Procedure and Substance

During 1995, the Indiana courts decided two cases involving claims of

permanent total disability, K-Mart Corp. v. Morrison51 and Hill v. Woodmark
Corp.

5
* In so doing, the courts provided counsel and the Board guidance in both

substantive law and matters of procedure.

A. K-Mart Corp. v. Morrison

In K-Mart Corp. v. Morrison, the Indiana Court of Appeals interpreted the
scope of the provision within Indiana's Worker's Compensation Act that entitles

an employer to terminate or otherwise deny compensation when an employee,
without justification, refuses employment suitable to the physical limitations

caused by his work injury.
59

In K-Mart Corp., Morrison's reflex sympathetic

dystrophy ("RSD") caused substantial physical limitations, including arm, leg and

shoulder pain that resulted in her falling down and dropping things at times.60

K-Mart offered her a position behind the jewelry counter rather than in the apparel

department, which K-Mart believed to be more suitable to her physical limitations.

K-Mart believed her refusal to take the job justified a reduction in its worker's

55. Id.

56. In Weldy v. Kline, 652 N.E.2d 107 (Ind. Ct. App. 1995), the Board deemed unanswered

admissions as being admitted as true and accurate statements. However, because the admissions

led to contradictory conclusions, the Board reviewed deposition testimony to reach its conclusion.

Id. at 109.

57. 645 N.E.2d 18 (Ind. Ct. App. 1995).

58. 651 N.E.2d 785 (Ind. 1995).

59. Ind. Code § 22-3-3-1 1(a) (1993) states that "[i]f an injured employee, only partially

disabled, refuses employment suitable to his capacity procured for him, he shall not be entitled to

any compensation at any time during the continuance of such refusal unless in the opinion of the

worker's compensation board such refusal was justified."

60. K-Mart, 645 N.E.2d at 20 n.3.



1 148 INDIANA LAW REVIEW [Vol. 29: 1 1 39

compensation obligation. Because the court determined that Morrison was totally

disabled, it did not consider errors in applying Indiana Code section 22-3-3-11,
other than to cite its previous decision in Jones & Laughlin Steel Corp. v.
Kilburn

61
stating that the referenced statute only applies to partial disabilities and

not total disabilities.

More instructive, however, was the court's discussion of the meaning of its
remand and K-Mart's failure to challenge the Board's findings of fact.
Specifically, the court in its prior decision in K-Mart Corp. v. Morrison, 62

remanded the case back to the Board to use "facts as presented in the record, of
Morrison's disability status."

63 The court had found that the Board's findings of
fact regarding Morrison's permanent total disability were based on evidence that

was not in the record.
64

K-Mart contended that the court's remand required the
Board to hold a hearing and gather additional evidence. However, the court

concluded that the language of its remand could "in no way be found to require
the Board to conduct an evidentiary hearing."

65
Rather, the court simply stated

that the evidence the Board previously used to support its specific findings of fact

was not evidence in the record and that the Board must use evidence in the record

to support its specific findings of fact. K-Mart failed to challenge the evidence

ultimately used to support the Board's finding of permanent total disability.

Without this challenge, the court of appeals' standard of review required it to find

that the evidence in the record led to an "inescapable . . . contrary result" before

it could overturn the Board's decision.
66 No such contrary result was found by the

court.

K-Mart next argued that the court's prior finding—that the evidence of record
did not support Morrison's disability as being either permanent or

quiescent—conclusively indicated that the same evidentiary record could not
support a finding of total disability. After citing the evidence in the record used

by the Board to support its rinding of permanent total disability, the court

indicated that its prior reversal of the Board regarding whether the disability was

permanent or quiescent was not inconsistent with its current finding of permanent

total disability. To support this conclusion, the court referenced the distinction
between temporary total disability and permanent total disability made in
Covarubias v. Decatur Casting, Etc.

61
The Covarubias court recognized that

temporary total disability benefits focus on whether an injury prevents the claimant

from returning to the type of work he performed prior to the injury. On the other
hand, permanent total disability focuses on the question of whether the claimant

can return to any gainful employment.

An additional issue in K-Mart, which demonstrates the importance of

61

.

477 N.E.2d 345 (Ind. Ct. App. 1985).

62. 609 N.E.2d 17 (Ind. Ct. App. 1993).

63. Id. at 30.

64. Id.

65. K-Mart Corp. v. Morrison, 645 N.E.2d 1 8, 20 (Ind. Ct. App. 1995).

66. Id.

67. 358 N.E.2d 174 (Ind. App. 1976).



1 996] WORKER'S COMPENSATION 1 1 49

challenging questionable findings, involved the Board's decision to award total

disability benefits through March 8, 1994 when the evidence in the record was
closed in April of 1991. K-Mart contended that the award lacked evidentiary

support. However, the court concluded that K-Mart' s failure to challenge the

finding that "Morrison's condition had 'grown progressively worse for lack of

proper treatment'"
68
and its failure to tender any treatment specific to Morrison's

condition indicated that the Board's award of total disability beyond the date when
the record of medical evidence was closed was supported by the record.

69

B. Hill v. Woodmark Corp.

While K-Mart is instructive to counsel on the importance of properly

analyzing and challenging findings of fact, particularly in a case involving a

permanent total disability claim, Hill v. Woodmark Corp.
10
reminds the Board of

the importance of specific findings of fact supported by evidence in the record.

"In an unpublished memorandum decision, the Indiana Court of Appeals did not
reach the merits of the plaintiff's claim but remanded to the Board with

instructions to make specific findings of fact regarding Hill's ability to obtain
reasonable types of employment in light of his back injury."

71
Once the Board had

issued specific findings of fact, the Indiana Court of Appeals reversed the Board's

finding that Hill was not permanently totally disabled. The Indiana Court of

Appeals held that the evidence in the record did not support the finding that Hill

could find reasonable employment.
72

The Indiana Supreme Court, however, stated that the Indiana Court of

Appeals' decision "misperceive[d] the nature and character of the Board's role in

deciding this case."
73 The Indiana Supreme Court indicated that, when the Board

is in a position to determine whether the claimant has met the burden of proving

a permanent total disability, there is no requirement that there be evidence in the

record to make an affirmative finding that reasonable work is available. Rather,
the Board need only determine that he failed to prove that he was disabled.

74

Moreover, upon remand from the Indiana Court of Appeals, the Board used

evidence in the record to support its finding that Hill had not met his burden,

including evidence from two doctors chronicling specific physical activities that

Hill could perform. This evidence included the ability to lift specified amounts of

weight, the capacity to squat, bend and stoop for periods of time, grasping ability;

and full maneuverability of the neck and head.
75

68. K-Mart, 645 N.E.2d at 21 (quoting the findings of the Board).

69. Id.

70. 651 N.E.2d 785 (Ind. 1995).

71. Mat 786.
72. Hill v. Woodmark Corp., 632 N.E.2d 1173, 1178 (Ind. Ct. App. 1994), rev'd, 651

N.E.2d 785 (Ind. 1995).

73. Hill, 651 N.E.2d at 786.

74. Id.

75. Id. at 787.



1 1 50 INDIANA LAW REVIEW [Vol. 29: 1 1 39

The dissent in Hill indicated that the majority of the Board's findings were
"unsupported by the record and the remaining findings [did] not adequately show
the basis of the decision against appellant."

76
It also indicated that the findings

were not even minimally amenable to "appellate review."
77

The dissent stated that
"[findings of basic facts must reveal the Board's analysis of the evidence and its
determination therefrom regarding the very specific issues of fact which bear on
the particular claim . . . ,"

78
Notwithstanding the dissent's disagreement with the

majority in Hill, one thing remains certain. Findings of fact must be supported by
evidence in the record, and the courts are not reluctant to remind both counsel and

the Board of the importance of this matter of procedure, particularly when the
claim involves permanent total disability.

V. Apportionment

The issue addressed in U.S. Steel Corp. v. Spencer19 involved the proper
interpretation and application of the apportionment statute within Indiana's

Worker's Compensation Act, which reads in pertinent part, as follows:

If an employee has sustained a permanent injury either in another

employment, or from other cause or causes than the employment in which

he received a subsequent permanent injury by accident, ... he shall be

entitled to compensation for the subsequent permanent injury in the same
amount as if the previous injury had not occurred: Provided, however,
that if the permanent injuryfor which compensation is claimed, results

only in the aggravation or increase ofa previously sustained permanent

injury or physical condition . . . the board . . . shall award compensation
onlyfor that part ofsuch injury, or physical condition resultingfrom the
subsequent permanent injury}

In addressing the question of apportionment, the court provided guidance to

counsel as to when the following legal maxim applies:

[T]he employer takes his employees as he finds them, if he takes them at
all, and if they sustain injuries by accident arising out of and in the course

of employment they are entitled to compensation for their own injuries,
not for the injuries physically and mentally perfect employees would have

sustained in like accidents.
81

Notwithstanding the court's guidance, the efficacy of the apportionment statute's

role in claims wherein a subsequent injury results in permanent total disability

must also be seriously questioned as a result of U.S. Steel Corp.

76. Id. at 790 (DeBruler, J., dissenting).

77. Id.

78. Id. (quoting Perez v. U.S. Steel Corp., 426 N.E.2d 29 (Ind. 1981)).

79. 645 N.E.2d 1 106 (Ind. Ct. App. 1995).

80. Ind. Code § 22-3-3- 12(1 993) (emphasis added).

81

.

Goodman v. Olin Matheison Chem. Corp., 367 N.E.2d 1 140, 1 146 (Ind. App. 1977).



1996] WORKER'S COMPENSATION 1151

The U.S. Steel Corp. court indicated that the apportionment statute does not
apply to reduce an employer's liability for benefits when the employee is only
predisposed or somehow more susceptible to a particular injury. 82 However, if
there is a pre-existing impairment that "combines with an impairment resulting

from a subsequent compensable accidental injury to render [the claimant] either

permanently totally disabled or permanently partially impaired in a greater degree

than would have resulted from the subsequent injury had there been no pre-
existing impairment,"

83
then the apportionment statute applies to reduce the

employer's liability to the amount of impairment or disability caused by the injury

that occurred during employment. Thus, whether the apportionment statute

applies depends upon whether a preexisting condition of the body is an

impairment or a disability, or simply a predisposition or susceptibility to an injury

that the current work injury exacerbated or aggravated.

A compelling question prompted by U.S. Steel Corp. is whether, in light of the
case law definition of "disability," a permanent total disability is subject to

apportionment based on either a preexisting disability or permanent impairment.

In U.S. Steel Corp., Spencer had a preexisting back injury resulting from an

accident while playing baseball in 1973. In 1974, Spencer underwent surgery to

fuse his spine. Unfortunately, the spinal fusion deteriorated causing Spencer to

take a leave of absence from work for a year.
84 Upon returning to work at U.S.

Steel, Spencer was restricted from heavy lifting, bending and standing. He
continued back treatments from 1975 to the date of his second injury on June 15,

1983. According to medical testimony, his injury resulted in a fifty-five percent

permanent partial impairment rating, twenty percent of which was considered

causally connected to the second injury.
85

Although the facts of this case appear to properly invoke application of the

apportionment statute, they call into question an interesting conundrum brought
about by a distinction between the term "impairment" and the term "disability"

under Indiana's Worker's Compensation Act. As the court succinctly explains,
"the issue of physical impairment concerns medical evidence related to the loss of

bodily function, whereas a disability determination rests on vocational factors

relating to the ability of an individual to engage in reasonable forms of work
activity."

86
Although the Board relied upon the medical findings of Spencer's

doctor to determine that only twenty-percent of Spencer's impairment was caused
by his 1983 work injury, it also appeared to rely on the testimony of a clinical
psychologist concerning Spencer's permanent total disability. In that regard, the

clinical psychologist observed that Spencer was capable of working, although in

a diminished capacity, from the date of his 1973 baseball injury up to the date of

82. U.S. Steel Corp., 645 N.E.2d at 1 108 (citing Bethlehem Steel Corp. v. Cummings, 310

N.E.2d 565 (Ind. App. 1974)).

83. Id. at 1 108 (citing Goodman, 367 N.E.2d at 1 140).

84. Id. at 1107.

85. Mat 1108.
86. Id. at 1 109 (citing Rockwell Int'l v. Byrd, 498 N.E.2d 1033 (Ind. Ct. App. 1986)).



1152 INDIANA LAW REVIEW [Vol. 29: 1 1 39

his 1983 work injury,
87

at which point he was no longer able to engage in gainful
employment. Because the Board appeared to have relied on the "conflicting

opinions of the experts,"
88

the court remanded the case to the Board to determine

if Spencer was "suffering from a condition which impaired or disabled him prior
to the 1983 injury."

89
If so, the court directed the Board to apply the

apportionment statute.

The problem in this case is that Spencer, medically, would appear to have
suffered a preexisting permanent impairment entitling U.S. Steel to apportionment

for the impairment caused by the 1983 injury. Moreover, Spencer's work
activities from 1973 to 1983 were limited or diminished based on his medical

restrictions suggesting some type of disability. However, upon remand, the Board

did not apportion the award for the permanent total disability that resulted from the

subsequent 1983 work injury. This evokes the important question of whether the

Board must find a preexisting permanent partial disability in order to apply the

apportionment statute to Spencer's resulting permanent total disability. If so, the

U.S. Steel Corp. case was over at the moment both parties agreed that permanent
total disability resulted from the 1983 work injury because Indiana's Worker's
Compensation Act, unlike other worker's compensation acts, does not recognize

permanent partial disability, at least as a separately compensable type of injury.
90

Indeed, under Indiana law, a permanent disability only exists if it is one-hundred

percent disabling despite references to the contrary in prior and subsequent cases.
91

To further explain, in K-Mart Corp. v. Morrison92 the court distinguished
"temporary total disability from permanent total disability."

93 The distinction

referenced indicates that the term "disability," in the context of temporary total

87. Spencer returned to work after his 1973 injury "with a heavy lifting, bending and

standing work restriction imposed on him by his physician." Id. at 1 107.

88. Mat 1109.
89. Id.

90. See Jenkins v. Pullman Standard Car Mfg. Co., 139 N.E.2d 566 (Ind. Ct. App. 1957).

Under Indiana's Occupational Diseases Act found at IND. CODE §§ 22-3-7-1 to -38 (1993 & Supp.
1996), the loss or loss of use of any eye or appendage (i.e., schedule injuries) is referred to as a

disablement whereas, the same loss or loss of use of an eye or appendage under Indiana's Worker's

Compensation Act is not referred to as a disablement. Thus, it could be argued that a scheduled

injury is tantamount to & permanent partial disability despite the terminology. If so, a preexisting

scheduled injury coupled with a subsequent injury causing permanent total disability could allow

for the apportionment of the permanent total disability.

91

.

In Goodman v. Olin Matheison Chem. Corp., 367 N.E.2d 1 140, 1 144 (Ind. App. 1977),

the court explained that someone can be permanently disabled to a "greater degree" if they have a

preexisting injury. Again, in a subsequent decision of U.S. Steel Corp., the concept of a "naturally

progress[ing]" disability was suggested to imply that Spencer may have been disabled but not such

that the disability would have naturally progressed to total disability. U.S. Steel Corp. v. Spencer,

655 N.E.2d 1243, 1247 (Ind. Ct. App. 1995). Consequently, both cases strongly suggest a type of

permanent disability that is less than total.

92. 645 N.E.2d 18 (Ind. Ct. App. 1995).

93. Id. at 20 (citing Covarubias v. Decatur Casting, Etc., 258 N.E.2d 174 (Ind. App. 1976)).



1996] WORKER'S COMPENSATION 1 153

disability, means the employee is unable to return to the type of work he was
performing immediately prior to the injury. The term "disability" within the
context of permanent total disability means the employee is unable to return to any

gainful employment. Based on the facts in U.S. Steel Corp., it would appear that

Spencer was able to return to gainful employment but unable to return to the type

of work he was performing prior to the 1973 baseball injury. In that regard, it
could be said that, between 1973 and 1983, Spencer was "disabled" in accordance

with the definition of temporary disability. Undeniably, the facts indicate that he

was not permanently disabled as a result of his 1973 baseball injury because he
remained gainfully employed by U.S. Steel and was able to work.

In the subsequent decision in U.S. Steel Corp.,
94

the court affirmed the finding

of the Board that there was no basis upon which to apportion Spencer's disability.

On remand, the Board did not focus on impairment but rather issued findings
regarding disability. In fact, the Board rejected the medical testimony upon which

it, in part, preliminarily relied and instead focused on the expert opinion of the

clinical psychologist. It would seem the Board was quite aware that it could not
apportion a "disability" as defined under the permanent total disability definition

of Covarubias. Specifically, a person with a "disability," as defined under the

permanent total disability definition in Covarubias, would never find himself back

in the work place to be subjected to a subsequent injury, which the apportionment

statute was enacted to address.

The Board, arguably, could have found Spencer's impairment apportionable
relying on the purely medical testimony of the medical expert. However, the Act

does not contemplate a deduction in benefits when an apportionable impairment
exists if the claimant is permanently and totally disabled. In other words, an

apportionment of Spencer's "impairment" would not have reduced U.S. Steel's

benefit payment obligation to Spencer because there was no separate additional
permanent partial impairment benefit award "stacked" on top of the permanent

total disability award. Moreover, because impairment addresses a purely physical

measurement of some loss of bodily function, whereas disability measures the
effect the loss of function has on the claimant's ability to work, it is difficult to

reason how a preexisting impairment would diminish an employer's obligation for
an employee's subsequent disability.

To further analyze this problem, a preexisting impairment and a subsequent
impairment are capable of being added together under the apportionment statute

to create a permanent total disability. There is no doubt that two injuries to the

same part of the body can be added to produce a greater impairment than each
injury standing alone would cause. There is equally no doubt that the

apportionment statute allows the Board to identify the impairment rating of each

of the two injuries and only charge the employer with the responsibility of paying

the permanent partial impairment benefits attributable to the degree of impairment

caused by the injury that occurred in its employment. As long as the issue is
confined to permanent partial impairment, the apportionment statute seems to

work fine. However, when the two injuries combine to produce an impairment,

94. U.S. Steel Corp. v. Spencer, 655 N.E.2d 1243 (Ind. Ct. App. 1995).



1 1 54 INDIANA LAW REVIEW [Vol. 29: 1 1 39

which, together with vocational factors, results in permanent total disability, the

employer's permanent partial impairment benefit liability changes to an obligation

to pay permanent total disability benefits. Any credit the employer would have
received in terms of a reduction for the preexisting impairment is lost unless the

Board and courts recognize that a disability can exist without being a total
disability.

In U.S. Steel Corp., the Board and the court attempted to "square" the unequal

sides of the dilemma brought to light by the apportionment statute by implying that

a permanent total disability can be apportioned if the prior injury "would naturally

progress into permanent total disability on its own."
95

Although such a standard

would place an employer in the difficult position of obtaining vocational evidence

to establish that a preexisting injury was capable of deteriorating to a point at

which a claimant would no longer be able to work, it also suggests that due to a
preexisting injury a partial disability can coexist with a permanent partial

impairment and a subsequent injury can accelerate the partial disability into a

permanent total disability. Consequently, the apportionment statute may still be
able to fully serve its benign purpose by allowing for the apportionment of

permanent total disability if the Board and courts recognize that partial disability

is the type of preexisting disability contemplated by the apportionment statute.
96

This however would require a permanent partial impairment to coexist with a
temporary partial disability.

97

In the context of the necessarily retrospective application of the apportionment

statute, it is not inconsistent for the Board or courts to find that a claimant with an

injury causing some permanent partial impairment can remain gainfully employed

although partially disabled by the impairment. The evidence of partial disability,

demonstrated by the facts in U.S. Steel Corp., would be the diminished physical

capacity of the employee that required a medical restriction as to the work he or
she was able to perform.98 This concept is consistent with the partial disability

referenced in Indiana Code section 22-3-3-1 1."

Importantly, however, recognizing the possibility of partial disability in the

context of the apportionment statute would not require the Board or courts to

interpret such partial disability as separately compensable. The Board and the

courts would also not be required to interpret the temporary partial disability

benefits statute as requiring the employer to pay benefits under the statute as an

additional benefit after a permanent partial impairment is established.
100

In U.S.

95. Mat 1247.
96. The concept of partial disability is embodied in Ind. Code § 22-3-3-1 1 (1993).

97. A temporary disability, either partial or total, is temporary because it has not reached
quiescence and is not yet capable of being rated as a permanent impairment.

98. Due to the requirement of reasonable accommodation under the Americans With

Disabilities Act, it is likely that workers, who in the past may have been unable to work, will now

remain gainfully employed although not in the same job capacity.

99. Although the statute does not include the word "temporary" with its text, it has been

interpreted as one of the statutes addressing temporary partial disability.

100. Ind. Code § 22-3-3-9 (1993). Under this statute, the Board has interpreted the benefits



1 996] WORKER'S COMPENSATION 1155

Steel Corp., the Board could have used Spencer's permanent impairment

apportionment ratio to apportion Spencer's permanent total disability by finding

that Spencer had a temporary partial disability that clearly restricted his ability to

perform certain types of work. Unfortunately, the Board may have been saddled
with the "all or nothing" definition of permanent total disability that leads

inextricably to virtually never finding a preexisting disability.

VI. Second Injury Fund

Linville v. Hoosier Trim Products
m

required the court to interpret the

provision within Indiana's Worker's Compensation Act defining the purpose of

the second injury fund. Specifically, Indiana Code section 22-3-3- 13(a) provides
as follows:

If an employee who from any cause, had lost, or lost the use of, one (1)
hand, one (1) arm, one (1) foot, one (1) leg, or one (1) eye, and in a

subsequent industrial accident becomes permanently and totally impaired

by reasons of the loss, or loss of use of, another such member or eye, the
employer shall be liable only for the compensation payable for such

second injury. However, in addition to such compensation and after the

completion of the payment therefore, the employee shall be paid the

remainder of the compensation that will be due for such permanent

impairment out of a special fund known as the second injury fund ....

In this case, Linville received an injury in 1982 that resulted in an eleven

percent permanent partial impairment of her right hand and then received an injury

in 1988 resulting in a thirty-seven percent permanent partial impairment of her left

hand. The combined result of these two injuries left her permanently totally
disabled. The court was asked to interpret two phrases within the statute. First,
the court was required to interpret whether the phrase "lost" or "lost the use of
required a finding that the body part must be a one-hundred percent loss or must

be one-hundred percent unable to function. Then, the court was required to

interpret the meaning of the phrase "permanently and totally impaired."
102

In explaining its approach the court cited Associated Insurance Companies,

Inc. v. Burns,
m

stating that a "liberal construction is necessary to accomplish the

Act's beneficent purposes."
104

Although the Board denied Linville' s claim against

the second injury fund because she had not lost one-hundred percent use of either

hand, the court held that "'loss of use' should be interpreted to refer to either total

to be due only during the time prior to the claimant reaching maximum medical improvement. See

Kohman v. Indiana University, No. 93A029512-EX00750 (Ind. Ct. App. Dec. 20, 1995)

(unpublished decision).

101. 659 N.E.2d 250 (Ind. Ct. App. 1 995).

102. Id. at 252.

103. 562 N.E.2d 430 (Ind. Ct. App. 1990).

104. Linville, 659 N.E.2d at 252.



1 1 56 INDIANA LAW REVIEW [Vol. 29: 1 1 39

or partial loss."
105

The court also explained that the Board's interpretation of
"permanent and totally impaired" had a very narrow application. 106 Because a
narrow application would have been inconsistent with a liberal construction of the
law, the court concluded that permanent and total impairment was synonymous
with permanent total disability. Consequently, the court found that Linville's

diminished use of both hands resulted in permanent total disability entitling her

to benefits from the second injury fund.

The dissent in this case believed that the language of the statute was
unambiguous particularly in light of "Ind. Code § 22-3-3- 10(c) which
distinguishes between accidents causing 'loss by separation,' 'loss of use,' and

'partial loss of use.'"
107

Thus, the dissent believed that "loss of use" could only

mean one-hundred percent loss of use, which did not occur to either of Linville's
hands. The dissent, therefore, agreed with the Board's decision.

In the rehearing of Linville v. Hoosier Trim Products}
m

the court adopted the

logic of the dissent in the initial Linville decision. The court overturned its
original decision finding that the terms "lost" and "lost the use of were not
ambiguous simply because they were not defined in the Worker's Compensation

Act. The court defined "loss" as a "total deprivation of a body part, or the total
deprivation of the use of a body part."

109
Moreover, the court noted that because

Indiana Code section 22-3-3- 10(c) references "partial loss," the term "loss" must
be modified by the term "partial" to be construed as a partial loss.

110

The court of appeals appears to be divided regarding the viability of claims
against the second injury fund. Thus, counsel may be well advised to review the
merits of any case involving preexisting and subsequent scheduled injuries before

making a claim against the fund.

VII. Medical Expenses

In Montgomery Aviation, Inc. v. Hampton,
111

the court was asked to "adopt a

definition of 'necessary'" medical expenses. The term "necessary" medical
expenses is not defined in Indiana's Worker's Compensation Act. Indiana Code
section 22-3-3-4 simply states that the employer must pay for '"such surgical,

hospital and nursing services and supplies as the attending physician or the

worker's compensation board may deem necessary.'"112

In Montgomery Aviation, Hampton had three knee surgeries, the first in July
of 1990, the second in January of 1991, and the third in February of 1992.

Montgomery Aviation argued that the third surgery was not a medically necessary

105. Id.

106. Id.

107. Id. at 253 (Darden, J., dissenting).

108. 664 N.E.2d 1 178 (Ind. Ct. App. 1996).

109. Id. at 1 179 (citing WEBSTER'S THIRD INTERNATIONAL DICTIONARY (1976)).

110. Id.

111. 650 N.E.2d 77, 80 (Ind. Ct. App. 1995).

1 12. Id. at 79 (citing Ind. Code § 22-3-3-4(a) (1993)).



1 996] WORKER'S COMPENSATION 1 1 57

expense because the evidence of record suggested that the doctors did not believe

it would cure or relieve Hampton's problem.
113 Montgomery Aviation's definition

of "necessary" would have required the doctor to '"reasonably believe the

treatment [would] have a curative or relieving effect' upon the injury."
114 The

court refused to adopt such a definition.

The court cited Talas v. Correct Piping Co.
115

as demonstrating that

"noncurative, prospective palliative measures, such as nursing services and

physical therapy"
116

are within the ambit of medical expenses for which an

employer is liable under Indiana's Worker's Compensation Act. However, the

court explained that Talas did not provide much guidance with respect to
retrospective medical expenses for a surgical procedure that was noncurative in

nature.

In providing counsel guidance as to the type of medical expenses for which

an employer may be liable, the court looked to evidence indicating that Hampton's
surgery was, at minimum, believed to uncover the nature of his knee pain.

Moreover, there was also evidence that the surgeon believed the surgery would

improve Hampton's knee condition.
117 Montgomery Aviation appears to define

medical expenses for which the employer is liable to include exploratory

procedures that are expected to help in diagnosing medical conditions.
118

VIII. Attorney's Fees

Unfortunately, Connecticut Indemnity Co. v. Bowman119 does not provide
counsel much guidance in the area of what action constitutes bad faith entitling
plaintiffs counsel to an award of attorney's fees. However, from a procedural

perspective, it is instructive with respect to stipulated cases. In Connecticut

Indemnity, Bowman filed an action against Connecticut Indemnity Co. ("CIC"),
the insurance carrier of Standard Locknut and Lockwasher, Inc. ("Standard

Locknut"), based on gross negligence, constructive fraud and intentional infliction

of emotional distress.
120 CIC argued that Bowman was collaterally estopped from

his lawsuit because the Board did not find in favor of Bowman upon his request
for attorney's fees based on the allegation that "the employer had acted in bad faith

113. Id. at 78.

1 14. Id. (quoting Brief of Appellant).

115. 435 N.E.2d 22 (Ind. 1992).

1 1 6. Hampton, 650 N.E.2d at 79.

117. Id.

118. The court pointed out that, even though the surgery was unsuccessful in curing

Hampton's problem, "in such surgery, no one can give a guarantee; there is never an assurance of

cure." Id. The court also took exception to Montgomery Aviation's suggestion that the only reason

the third surgery was performed was because Hampton wanted it to be performed. Such a

suggestion implies that "surgeons are willing to perform invasive procedures without good cause."

Id.

1 1 9. 652 N.E.2d 880 (Ind. Ct. App. 1995).

120. Id. at 882.



1 158 INDIANA LAW REVIEW [Vol. 29:1 139

in adjusting and settling" Bowman's claim. 121 CIC also argued that, because
Bowman's claim for attorney's fees based on bad faith was not among the issues
to which the parties stipulated, Bowman's request for attorney's fees was not
timely made.

122 The court found that, because the Board did not issue specific
findings regarding the basis for its denial of Bowman's claim for attorney's fees
and because the Board could have denied Bowman's claim for attorney's fees on
more than one basis, 123 Bowman was not collaterally estopped from filing his
lawsuit against CIC.

Although Bowman also argued that the Board had a statutory duty to
determine whether bad faith claims handling existed, the court did not address this

issue. Nevertheless, this case suggests the possibility that the Board will deny

claims for attorney's fees based on bad faith in stipulated cases if the issue is not

preserved within the scope of the parties' stipulation.

IX. Statute Of Limitations

The decision in East Asiatic/Plumrose, Inc. v. Ritchie 124 may cause counsel
substantial concern in terms of advising clients whether a claim has been closed

based on the statute of limitations. Plumrose interpreted Indiana Code section
22-3-3-27, often referred to as the modification statute, which allows for a claim

to be reopened by the Board when a change in circumstance indicates the need. 125

The statute of limitations, at least prior to the Plumrose case, enabled counsel to
provide guidance to their clients as to the point in time when the average claim
finally closed, meaning that it was no longer subject to modification under the

modification statute. As used herein, the term "average claim" refers to a claim
involving an employee who is injured such that she is unable to return to the work
she was doing when she was injured and therefore receives temporary total
disability ("TTD") benefits until such time as she is fully recuperated and back at

her job. In the past, counsel could advise their clients that such an average claim

could be considered closed two years after the date the last TTD benefits were
paid. The decision in Plumrose, however, no longer allows such advice to be
given. As a result of expected uncertainty in closing claims, absurd and
unintended action may prevail and cause a greater burden on Indiana's worker's
compensation system.

In Plumrose, claimant Ritchie was injured on July 6, 1988 when "a pipe
penetrated the roof of his mouth and the frontal lobe of his brain."

126
Ritchie was

paid in accordance with the "agreement to compensation" form, which was signed

121. Id. at 882, 883 (quoting Ind. CODE § 22-3-4-12 (1993)).

122. Id.

123. "[T]he Board could have denied the request because it was outside the scope of the

issues, or it could have denied the request because it found neither Standard Locknut nor CIC acted

in bad faith." Id. at 883.

124. 655 N.E.2d 87 (Ind. Ct. App. 1995).

125. Ind. Code § 22-3-3-27(a) (1993).
1 26. Plumrose, 655 N.E.2d at 88.



1 996] WORKER'S COMPENSATION 1 1 59

by him and approved by the Worker's Compensation Board.
127 The agreement to

compensation was signed on July 25, 1988, indicating TTD benefit payments were
to begin on July 14, 1988. Shortly thereafter, the agreement was approved by the
Board.

128 As is typical in such cases, TTD benefits continued until Ritchie was
released to return to work, which occurred on April 16, 1990. However, on April

24, 1990, Ritchie left work and was admitted to a hospital. Although Ritchie was
discharged from the hospital three weeks later, he never returned to work. 129 As
a result of his doctor determining that Ritchie had reached maximum medical
improvement, Plumrose and Ritchie entered into a settlement on October 11, 1990

in which 100 weeks of permanent partial impairment ("PPI") benefits were paid.

The PPI benefits technically were paid from July 6, 1988 to June 21, 1990.
130

On May 4, 1992, Ritchie filed an application with the Board to modify the
permanent partial impairment settlement. In response, Plumrose sought to dismiss

Ritchie's claim based on lack ofjurisdiction alleging that the statute of limitations

within Indiana Code section 22-3-3-27(c) barred modification of Ritchie's
settlement. The statute reads as follows:

The [Board] shall not make any such modification upon its own motion
nor shall any application therefore be filed by either party after the

expiration of two (2) years from the last day for which compensation was

paid under the original award made either by agreement or upon hearing,
except that applications for increased permanent partial impairment are

barred unless filed within one (1) year from the last day for which

compensation was paid.
131

The court rejected Plumrose' s argument that the statute of limitations should
bar Ritchie's application for modification. The court held that the phrase "original
award" does not refer to the award of TTD benefits. Rather, "[i]t is the permanent
partial impairment award that usually adjudicates the injured employee's right to

compensation up to that point in time."
132

Moreover, the court seized upon the

final clause of Indiana Code section 22-3-3-27(c) which states, "applications for
increased permanentpartial impairment are barred unless filed within one (1) year

from the last day for which compensation was paid."
133

The court reasoned that
the last clause of the above-referenced statute "suggests that the 'original award'

includes the award of PPI; a claimant cannot seek to increase PPI unless an award

of PPI had previously been made."
134

Thus, the court's decision in Plumrose holds

that a claim that only involved the award of TTD benefits does not contain an
"original award." Without an original award, the statute of limitations period set

127. Id.

128. Id.

129. Id.

130. Id.

131. Id. (emphasis added) (citing Ind. Code § 22-3-3-27(c) (1993)).

132. Id. at 90.

133. Id. (emphasis added) (quoting Ind. CODE § 22-3-3-27(c) (1993)).

134. Id.



1 1 60 INDIANA LAW REVIEW [Vol. 29: 1 1 39

forth in the modification statute will not begin. Consequently, claims for which

only TTD benefit payments are made remain subject to modification to an
uncertain date in the future.

The "fallout" of the Plumrose decision may cause insurance carriers to
maintain financial reserves for a longer period of time on claims involving only

TTD benefits, even when the claimant has returned to work without any indication
of a future manifestation of the injury. If this is the result, employers may pay
higher insurance premiums based on the cumulative effect of long outstanding

claim reserves on claims that heretofore would have been closed. Employers that

are not subject to reserving practices and procedures of insurance carriers or third

party administrators may have an even greater competitive advantage in the market
place as a result.

In addition, counsel may be forced to become involved in claims in which they
would otherwise not be involved. It can be expected that employers will not wish

to have claims remain open in virtual perpetuity. In an effort to close these "TTD
only" claims, employers may seek permanent partial impairment ratings from their
doctors. Claims that would otherwise go unrated simply because the claimant has

fully recuperated may now need to be rated. Employers may not be able to afford
the open liability associated with claims that do not have some type of PPI rating.
The claimant may respond to the PPI rating by retaining her own counsel to
dispute the rating. The end result may be more litigation and, hence, more burden
on a system originally designed to minimize litigation. It remains to be seen

whether claims that only involve TTD benefits will precipitate a great burden upon
Indiana's worker's compensation system.

X. Exclusive Remedy

The rights and remedies granted to an employee subject to IC 22-3-2

through IC 22-3-6 on account of personal injury or death by accident shall

exclude all other rights and remedies ofsuch employee, the employee's
personal representatives, dependents, or next of kin, at common law or
otherwise, on account of such injury or death . . . .

135

In 1995, the courts considered a number of cases involving the exclusive
remedy provision of the Indiana Worker's Compensation Act. Typical to this line

of cases, defendants in tort suits often attempted to avoid the trial court's

jurisdiction by invoking Indiana Code section 22-3-2-6, also known as the
exclusive remedy provision of the Act, arguing that the plaintiffs' sole remedy was

with the jurisdiction of the Board. In 1995, the courts' analysis of the exclusive

remedy provision of the Worker's Compensation Act included four cases in which

individuals who are often described as "loaned or borrowed servants" or "leased
employees" sought to invoke the exclusive remedy statute as a fellow servant or

coemployee of the injured party.
136 The courts also reviewed three cases in which

1 35. Ind. Code § 22-3-2-6 (Supp. 1996) (emphasis added).

1 36. Williams v. R.H. Marlin, Inc., 656 N.E.2d 1 145 (Ind. Ct. App. 1995); U.S. Metalsource



1996] WORKER'S COMPENSATION 1161

a plaintiff injured by a coemployee attempted to avoid the exclusive remedy statute

by raising the horseplay or intentional acts exception to the statute.
137

Finally, the

courts reviewed two cases in 1995 in which exclusive jurisdiction of the Board

was avoided, once based upon the type of injuries claimed by the plaintiff,
138

and

once based upon the nature of the claimant.
139

A. Exclusive Remedy Statute Invoked Under the Coemployee/Fellow Servant
Doctrine—Summary Judgment v. Motion to Dismiss

1. Riffle v. Knecht Excavating, Inc.—In Riffle, 140 the court reviewed the
classic set of circumstances in which the exclusive remedy provision is invoked

by a defendant who is commonly described as a loaned or borrowed servant or
leased employee and thereby claims tort immunity as a coemployee of the plaintiff.

Riffle's employer, a contractor, rented a backhoe and an operator to excavate a

large hole as part of a construction project.
141

Riffle was injured when struck by
a portion of the earthen wall that had dislodged while he worked at the bottom of

the hole. Riffle thereafter sued the backhoe operator, the excavating company
from which the backhoe and the operator were rented, and the property owner.

The backhoe operator's motion for summaryjudgment was granted by the trial
court, apparently on grounds that the backhoe operator was a borrowed servant of

Riffle's employer and thus a fellow employee of Riffle, removing the negligence

claim from the jurisdiction of the trial court and placing Riffle's remedy

exclusively with the Board.
142

In considering Riffle's argument that the trial court

erred in finding the backhoe operator to be a borrowed servant, the court first

reiterated the well established standard of review, indicating that in reviewing the

entry of summary judgment it could not weigh the evidence but could only
"consider the facts in the light most favorable to the nonmoving party."

143 The
court went on to acknowledge that the appropriate test to determine whether Riffle

and the backhoe operator were coemployees was whether the backhoe operator

could also have received worker's compensation benefits from Riffle's employer

had the backhoe operator been injured under similar circumstances.
144

In granting

summary judgment, the court applied the test by considering those facts most
favorable to Riffle as the nonmoving party.

Corp. v. Simpson, 649 N.E.2d 682 (Ind. Ct. App. 1995); Tapia v. Heavner, 648 N.E.2d 1202 (Ind.

Ct. App. 1995); Riffle v. Knecht Excavating, Inc., 647 N.E.2d 334 (Ind. Ct. App. 1995).

137. Tippmann v. Hensler, 654 N.E.2d 821 (Ind. Ct. App. 1995); Weldy v. Kline, 652 N.E.2d

107 (Ind. Ct. App. 1995); Tapia, 648 N.E.2d at 1202.

138. Terrell v. Rowsey, 647 N.E.2d 662 (Ind. Ct. App. 1995).

139. Ransburg Indus, v. Brown, 659 N.E.2d 1081 (Ind. Ct. App. 1995).

140. Riffle, 647 N.E.2d at 334.

141. Id. at 336.

142. Id.

143. Id. (citing Collins v. Covenant Mut. Ins. Co., 604 N.E.2d 1 190, 1 194 (Ind. Ct. App.

1992)).

144. Id. at 337 (citing Weldy v. Kline, 616 N.E.2d 398, 401-02 (Ind. Ct. App. 1993)).



1 1 62 INDIANA LAW REVIEW [Vol. 29: 1 1 39

The facts included that the backhoe operator was employed by Riffle's
employer in the usual course of its business, performed the same type of work as
the other regular employees working for Riffle's employer, reported daily to the

worksite supervisor for instruction, was provided with specific instruction as to the

work that he was to perform, and was provided with no discretion in the
performance of the work.

145
Under these facts, the court ruled that the backhoe

operator was also an employee of Riffle's employer and that the employment was

not casual. Thus, the backhoe operator was deemed a coemployee of Riffle and
thereby immune from Riffle's negligence action pursuant to Indiana Code section
22-3-2-6.

146 The court rejected Riffle's argument that the backhoe operator's dual
employment created a question of fact precluding summary judgment by relying
on the similar facts of Sharp v. Bailey.

U1
Interestingly, in a footnote, the court

acknowledged that the seven factor test set forth in Hale v. Kemp for determining
whether an employer/employee relationship existed was appropriate, but "the

cases employing these factors were largely irreconcilable."
148

Following Riffle, the court considered three additional "dual employment" or

"loaned or borrowed" servant cases on jurisdictional grounds by way of review of
the trial courts' summary judgment rulings.

149
These cases are significant in light

of the courts' analysis of the pretrial procedure involving the use of a Trial Rule

56 motion for summary judgment to address the jurisdictional questions raised by
the exclusive remedy provision of the Worker's Compensation Act.

2. Tapia v. Heavner.—In Tapia, the Fifth District was required to review the
employment status of Tapia, who was injured by Heavner, an employee of Ohlson
& Associates (collectively "Ohlson"), the employer to which Tapia' s services were
"loaned" by her general employer, Standard Life Insurance Company of Indiana
("Standard Life").

150
Tapia filed a negligence action against Ohlson, and Ohlson

asserted lack of subject matter jurisdiction as a defense. Ohlson later filed a

motion for summary judgment alleging that, because it was Tapia' s employer, her
exclusive remedy was with the Board pursuant to Indiana Code section 22-3-2-6.

The trial court agreed and granted Ohlson' s motion. 151

Unlike the Riffle court, the Tapia court did not apply the typical summary
judgment standard of review.

152
Instead, the court analyzed the jurisdictional basis

145. Id.

146. Id.

147. Id. (citing Sharp v. Bailey, 521 N.E.2d 368 (Ind. Ct. App. 1988)).

148. Id. at 337 n.l (citing Hale v. Kemp, 579 N.E.2d 63, 67 (Ind. 1991)).

1 49. Williams v. R.H. Marlin, Inc., 656 N.E.2d 1 145 (Ind. Ct. App. 1995); U.S. Metalsource

Corp. v. Simpson, 649 N.E.2d 682 (Ind. Ct. App. 1995); Tapia v. Heavner, 648 N.E.2d 1202 (Ind.

Ct. App. 1995).

1 50. Tapia, 648 N.E.2d at 1 204-05.

151. Id. at 1205.

1 52. "When reviewing an entry of summary judgment, we stand in the shoes of the trial court.

We do not weigh the evidence but will consider the facts in the light most favorable to the
nonmoving party." Riffle, 647 N.E.2d at 336 (citing Collins v. Covenant Mut. Ins. Co., 604 N.E.2d

1 190, 1 194 (Ind. Ct. App. 1992)).



1 996] WORKER'S COMPENSATION 1 1 63

of Ohlson's summary judgment motion and noted that "[t]he defense that a claim
is barred by the exclusivity provision of the Act is an attack upon the court's

subject matter jurisdiction which cannot form the basis of a motion for summary
judgment."

153 The court went on to instruct that the proper procedural means of
raising a jurisdictional defense such as the exclusive remedy statute is through an

affirmative defense or a motion to dismiss under Indiana Rules of Procedure, Trial

Rule 12(B)(1). Moreover, the court correctly pointed out that, if a court lacking

subject matter jurisdiction takes action on the merits, such as by ruling on a motion

for summary judgment, its action is void. 154

The distinction between Ohlson's use of a summary judgment motion as
opposed to a motion to dismiss is significant in light of the factual nature of the

dispute involving the determination of Tapia's employment status. In considering

Tapia's argument that she was not employed by Ohlson at the time of her injury

but instead by her general employer, Standard Life, the court recited the well

established Indiana law that a person can have more than one employer as
exemplified in Fox v. Contract Beverage Packers, Inc. 155 Tapia agreed that the
seven factor test set forth in Fox

156
was the proper vehicle for determining whether

she was under the dual employment of Ohlson and Standard Life at the time of her

injury, but, because a number of the applicable material facts were in dispute,
Tapia argued that the court's granting of Ohlson's motion for summary judgment
was improper.

157

The court agreed that the trial court was presented with a factual dispute and
even acknowledged that, if it had resolved the matter under a standard of review

for summary judgment motions, it would have been compelled to reverse. 158

However, because the court determined that Ohlson's action should have been

treated by the trial court as a motion to dismiss under Trial Rule 12(B)(1), a

weighing of the evidence was proper. "Unlike ruling on a motion for summary
judgment, the trial court may weigh evidence and resolve factual disputes when
ruling on a motion to dismiss for lack of subject matter jurisdiction."

159
Thus, it

is proper for the trial court to consider and resolve any factual disputes, and the

153. Tapia, 648 N.E.2d at 1205 (citing Perry v. Stitzer Buick GMC, Inc., 637 N.E.2d 1282
(Ind. 1994)).

1 54. Id. (citing Perry, 637 N.E.2d at 1 282).

155. Id. at 1206 (citing Fox v. Contract Beverage Packers, Inc., 398 N.E.2d 709 (Ind. Ct.

App. 1980)).

1 56. Test for determining the existence of an employee/employer relationship as set forth in

Fox requires consideration of the following facts: "(1) the right to discharge; (2) the mode of

payment; (3) supplying tools or equipment; (4) belief of the parties and the existence of an

employer/employee relationship; (5) control over the means used in the results reached; (6) length

of employment; and (7) establishment of the work boundaries." Id. (citing Fox, 398 N.E.2d at

711-12).

157. Id.

158. Id. at 1205.

159. Id. (emphasis added) (citing Perry v. Stitzer Buick GMC, Inc., 637 N.E.2d 1282, 1286
(Ind. 1994)).



1 1 64 INDIANA LAW REVIEW [Vol. 29: 1 1 39

court of appeals should affirm the trial court on any theory that is supported by
evidence contained in the record.

160

The impact of the Tapia court's procedural analysis cannot be diminished.
Had it applied the summary judgment standard of review employed by the Riffle
court, it would have been compelled to reverse and remand for the trier of fact to
resolve the issue of whether Tapia was employed by both Ohlson and Standard
Life. Instead, the court engaged in a review of the facts relating to the Fox seven
factor test and found that at least five of the seven factors supporting Tapia'

s

employment by Ohlson were present.
161

The court thus concluded that Tapia was
employed by Ohlson at the time of her injury, and her only recourse was with the
exclusive remedy afforded her by the Worker's Compensation Act. This,
however, did not end the court's analysis. Because Tapia' s injury allegedly

occurred as a result of horseplay or an intentional act, the court was required to
determine whether she was provided with an exception to the exclusive remedy
statute, which will be discussed in greater detail in Part X.B.

162

Lest there be any doubt that all future challenges to a trial court's jurisdiction

based upon the exclusive remedy provision of the Act should be raised in terms

of a Trial Rule 12(B)(1) motion to dismiss, two subsequent decisions in 1995

followed the Tapia pretrial procedure analysis.
163

3. U.S. Metalsource v. Simpson.—In U.S. Metalsource, Simpson was a truck
driver employed by Whiteford National Lease ("Whiteford"). Simpson, on behalf

of Whiteford, hauled steel exclusively for U.S. Metalsource for nearly two years

until he was injured while trying to move a load of steel on his truck. U.S.
Metalsource defended Simpson's negligence claim on the jurisdictional grounds

of the exclusive remedy statute, claiming that it was a coemployer of Simpson at

the time of his injury. The trial court, however, denied U.S. Metalsource' s motion
for summary judgment. 164 As in Tapia, the U.S. Metalsource court also
considered the trial court's decision under the standard of review for a motion to

dismiss for lack of subject matter jurisdiction under Trial Rule 12(B)(1) rather

than as a motion for summaryjudgment. Upon application of the Fox seven factor
test,

165
the court found that U.S. Metalsource was Simpson's employer at the time

of his injury and remanded to the trial court with instructions to dismiss the action

for want of jurisdiction.
166

4. Williams v. R.H. Marlin, Inc.—Finally, in October, 1995, the court
reviewed a construction accident case involving borrowed servant and

coemployment issues similar to the facts of Riffle. In Williams v. R.H. Marlin,

160. Id.

161. Id.

162. Id.

163. Tippmann v. Hensler, 654 N.E.2d 821 (Ind. Ct. App. 1995); U.S. Metalsource Corp. v.

Simpson, 649 N.E.2d 682 (Ind. Ct. App. 1995).

1 64. U.S. Metalsource, 649 N.E.2d at 684.

1 65. Id. at 685 (citing Fox v. Contract Beverage Packers, Inc., 398 N.E.2d 709, 711-12 (Ind.

Ct. App. 1980)).

166. Id. at 685. 686.



1 996] WORKER'S COMPENSATION 1 1 65

Inc.,
161

Williams was employed by a subcontractor on a construction project.

Similar to Riffle, the general contractor leased a crane and crane operator from

R.H. Marlin, Inc. ("Marlin") to provide lifting services for all contractors and

subcontractors on the project. Williams brought a negligence action against

Marlin, its crane operator and others after being injured when a crane basket in
which he was riding was dropped.

168
Again as in Riffle, summary judgment

motions were filed alleging exclusive jurisdiction of the Board because the crane

operator was the borrowed servant of Williams's employer and thereby a

coemployee of Williams. The trial court agreed and ruled that it was without
jurisdiction in light of the exclusive remedies of the Worker's Compensation

Act.
169

The Williams decision is significant in that, unlike Riffle, the Williams court

applied the Trial Rule 12(B)(1) motion to dismiss standard of review rather than

a summary judgment standard of review.
170

Moreover, the Williams court also

employed the seven factor Fox test utilized by Tapia and U.S. Metalsource.
]1]

Unlike the result in Tapia and U.S. Metalsource, however, the Williams court

reversed the trial court's ruling that it lacked subject matter jurisdiction, finding

that Williams's employer was not the special employer of the crane operator, and,

because Williams and the crane operator were not coemployees, Williams'

negligence action was not barred by the exclusivity provision of the Act.
172 With

the freedom to weigh the evidence under a Trial Rule 12(B)(1) motion to dismiss

standard of review, the Williams court undertook an exceedingly thorough fact-

sensitive analysis in applying the Fox seven factor test as set forth in Hale v.

Kemp.
113

In this case, however, the fact-sensitive analysis yielded no immunity

from suit for the crane operator because he was not deemed a coemployee of
Williams, and Williams therefore established jurisdiction with the trial court.

174

Given these recent decisions, it is clear that any challenges to a trial court's

jurisdiction based upon the exclusive remedy provision of the Worker's

Compensation Act must be treated by the trial court as a motion to dismiss under

Trial Rule 12(B)(1), even if raised as a motion for summary judgment. Obviously,
this provides the trial court great flexibility in considering and weighing what may
otherwise be disputed facts. Importantly, although a defendant seeking to avoid

the trial court's jurisdiction as a coemployer or coemployee under the exclusive

remedy statute usually carries the burden of proof, that burden shifts to the

plaintiff when the action is properly before the court as a motion to dismiss for
lack of subject matter jurisdiction.

175

167. 656 N.E.2d 1 145 (Ind. Ct. App. 1995).

168. Id. at 1148-49.

169. Id. at 1149.

170. Id.

171. Id. at 1 1 5 1 (citing Hale v. Kemp, 579 N.E.2d 63, 67 n.2 (Ind. 1 99 1 )).

172. Id. at 1150.

173. Id. at 1151-53.

174. Id. at 1153.

175. Id. at 1 149 (citing Foshee v. Shoney's, Inc., 637 N.E.2d 1277, 1281 (Ind. 1994)); Tapia



1 1 66 INDIANA LAW REVIEW [Vol. 29: 1 1 39

B. Horseplay/Intentional Acts Exception to the Exclusive Remedy

1. Tapia v. Heavner.—It does not automatically follow that a tortfeasor may
escape trial court jurisdiction through the exclusive remedy statute simply by
establishing employer/employee or coemployee status.

176
In Tapia, as discussed

above, the defendant Ohlson was able to establish an employer/employee

relationship with Tapia, which would thereby typically invoke the exclusive
remedy provision. However, Tapia' s injury was caused when an individual,
deemed by the court to be a coemployee, pulled a lever causing Tapia' s chair to
fall to the floor.

177
Accordingly, the court engaged in further analysis to determine

whether the coemployee' s actions amounted to horseplay that would remove him
from the protection of the exclusive remedy provision of the Act. The court
acknowledged that "[a] number of recent decisions have carved out an exception
holding that where a co-employee engages in horseplay or various non-job related

activities, he forfeits the immunity provided by the statute."
178

Under this line of
cases, the intentional activity, or horseplay, of pulling a lever and causing Tapia'

s

chair to drop would have been considered not in the course of employment and the

individual perpetrating the activity would therefore not have been "in the same

employ" as Tapia for purposes of the exclusive remedy provision of the Worker's

Compensation Act.
179

The Tapia court declined to follow this line of cases, however, and instead
adopted the test for determining whether individuals are "in the same employ" as

set forth in Weldy v. Kline.
m

Pursuant to Weldy, the test is simply whether the

defendant-tortfeasor would be entitled to worker's compensation benefits "under

the same or similar circumstances."
181

Thus, the Tapia court concluded that,

because its analysis had deemed Tapia to be a coemployee of Heavner, the
individual that caused her chair to drop, they were both in the same employ and

otherwise identically situated. Therefore, the court concluded that, in a reverse

situation, Heavner would likewise have been entitled to worker's compensation

benefits as was Tapia.
182

Without further consideration of the horseplay

v. Heavner, 648 N.E.2d 1202, 1205-06 (Ind. Ct. App. 1995) (citing Perry v. Stitzer Buick GMC,

Inc., 637 N.E.2d 1282, 1287 (Ind. 1994)).

176. Tapia, 648 N.E.2d at 1207 (citing Burke v. Wilfong, 638 N.E.2d 865 (Ind. Ct. App.

1994)).

177. Id. at 1205.

178. Id. at 1207 (citing Fields v. Cummins Employees Fed. Credit Union, 540 N.E.2d 63

1

(Ind. Ct. App. 1989); Seiler v. Grow, 507 N.E.2d 628 (Ind. Ct. App. 1987); Martin v. Powell, 477

N.E.2d 943 (Ind. Ct. App. 1985)); see also supra note 30.

179. Tapia, 648 N.E.2d at 1207-08 (citing Fields, 540 N.E.2d at 637).

180. Id. at 1208 (citing Weldy v. Kline, 616 N.E.2d 398 (Ind. Ct. App. 1993)).

181. Id.

182. Id. Following her injury, Tapia filed a claim for worker's compensation against her

general employer, Standard Life, and received worker's compensation benefits from Standard Life's

insurance carrier. Id. at 1205.



1996] WORKER'S COMPENSATION 1 167

allegations, the court deemed Heavner to be in the same employ as Tapia and
thereby entitled to immunity from Tapia' s negligence action by way of the
exclusive remedy statute. The court remanded with direction to dismiss Tapia'

s

claim for lack of subject matter jurisdiction.
183

2. Tippmann v. Hensler.—As already discussed above in Part I.B., the court
again considered the horseplay/intentional act exception to a coemployee's

immunity from suit in Tippmann v. Hensler.
m

In Tippmann, there was no

apparent dispute that the defendant, Tippmann, and Hensler were coemployees.

Both worked for the same company, and while on a work break Tippmann,

Hensler and other employees gathered in a paint booth where paint guns were

typically test fired. The employees fired paint guns at the ceiling, but Tippmann
fired a paint gun that struck Hensler' s eye, causing his injury.

185

Hensler filed a worker's compensation claim and received benefits as a result

of the injury to his eye. Hensler thereafter filed a complaint against Tippmann
alleging negligence or intentional conduct, apparently attempting to avoid the

exclusive remedy provision of the Worker's Compensation Act that would

otherwise afford Tippmann immunity from Hensler' s action. 186 Tippmann filed
a summary judgment motion on the basis of the exclusive remedy provision, but
the trial court denied Tippmann' s motion in light of what it deemed to be genuine
issues of material fact, including whether the parties were engaged in horseplay,

whether the parties were in the same employ, and whether Tippmann' s actions

were intentional.
187 As in Williams, U.S. Metalsource, and Tapia, the Tippmann

court acknowledged that the proper procedural vehicle for challenging the trial

court's subject matter jurisdiction was through a motion to dismiss rather than a

motion for summary judgment and analyzed the case accordingly.
188

In analyzing the trial court's ruling, the court referenced the exclusivity

provision contained in Indiana Code section 22-3-2-6, followed by what may be
described as the exception to the Worker's Compensation Act's exclusive remedy

provision.
189

Essentially, to the extent that an employee's injury is caused by an

183. Id.

184. 654 N.E.2d 821 (Ind. Ct. App. 1995).

185. Id.

186. Id. at 823-24.

187. Id. at 823.

188. Id. at 824.

1 89. Ind. Code § 22-3-2-13 (1993) contains what has been described as an exception to the

exclusive remedy statute in the following provision:

[W]henever an injury or death, for which compensation is payable under Chapters 2

through 6 of this article shall have been sustained under circumstances creating in some

other person than the employer and not in the same employ a legal liability to pay

damages in respect thereto, the injured employee or his dependents, in case of death,

may commence legal proceedings against the other person to recover the damages

notwithstanding the employer's or the employer's compensation insurance carrier's

payment of or liability to pay compensation under Chapters 2 through 6 of this article.

Id. (emphasis added).



1 1 68 INDIANA LAW REVIEW [Vol. 29: 1 1 39

individual that is "not in the same employ" as the injured employee, the Worker's
Compensation Act allows a negligence action to be brought against such
individuals.

190 As in Tapia, the Tippmann court also relied upon the Weldy test for
determining whether individuals are in the same employ.

191
Applying this test, the

court concluded that Tippmann and Hensler were in the same employ because they
were both participating in a regularly-scheduled work break when the accident
occurred. This "support[ed] the conclusion that had Tippmann been injured under
the same circumstances, he would have been able to obtain worker's compensation

benefits to the same extent as Hensler."
192

The court went on, however, to analyze
the horseplay-related incident in terms of the "arising out of and "in the course
of employment concepts, as discussed above in Part LB.

The court acknowledged that a work-related injury resulting from horseplay
may be deemed compensable when the employer acquiesces to such activity and
it thereby becomes a condition of employment, but, when the injured employee
actively participates in the horseplay, worker's compensation benefits will be

denied because active participation is considered an intervening cause.
193

Thus,

the court remanded the case to the trial court with instructions to make a rinding
of fact as to whether Hensler actively participated in the horseplay or was simply

an innocent victim.
194

The court reasoned that, if Hensler were deemed to be an innocent victim of
the horseplay, he would be subject to the exclusive jurisdiction provision of the

Worker's Compensation Act and the trial court would have no jurisdiction to hear

his case. On the other hand, if the trial court found that Hensler was an active
participant in the horseplay, the injury would not be deemed "in the course of his
employment and the provisions of the Act [would] not apply."

195
Presumably,

then, if Hensler was an innocent victim, his only remedy would be the worker's

compensation benefits that he had already received as the trial court would be

denied jurisdiction to hear his negligence claim under the exclusive remedy

statute. If, however, Hensler was found to have been an active participant, the

exclusive remedy provision of the Act would not apply, and Hensler would be

allowed to proceed with his negligence claim against Tippmann, although his

award of worker's compensation benefits totaling $19,983.60 would have been
196

improper.

190. Tippmann, 654 N.E.2d at 824 (citing Northcutt v. Smith, 642 N.E.2d 254, 256 (Ind. Ct.

App. 1994); Ind. Code § 22-3-2-13 (1993)).
191. The Weldy test is simply whether the defendant-tortfeasor would also be entitled to

worker's compensation benefits if hers and the injured employee's circumstances were reversed.

Id. at 825 (citing Tapia v. Heavner, 648 N.E.2d 1202, 1208 (Ind. Ct. App. 1995); Northcutt v.

Smith, 642 N.E.2d 254, 256 (Ind. Ct. App. 1994); Weldy v. Kline, 616 N.E.2d 398, 403 (Ind. Ct.

App. 1993)).

192. Id.

193. Id. at 826 (citing Weldy, 616 N.E.2d at 405).

194. Id.

1 95. Id. ; see also supra note 30.

1 96. Tippmann, 654 N.E.2d at 823. "Active participation is effectively an intervening cause



1 996] WORKER'S COMPENSATION 1 1 69

The dissent raised an interesting point in this regard. Essentially, the dissent
noted that, because Hensler had already successfully prosecuted his claim for

worker's compensation benefits, his claim against Tippmann should have been
dismissed by the trial court for lack ofjurisdiction.

197
Stated another way, it would

seem that a remand for a factual finding as to Hensler' s active participation, or

lack thereof, was unnecessary in light of the fact that he had been awarded benefits

under the Worker's Compensation Act. It is implicit, pursuant to Weldy, that, had

Hensler actively participated, he would not have been awarded benefits.
198

This

approach seems to be implied by the decision of the Tapia court in that Tapia, like

Hensler, was awarded worker's compensation benefits, and, upon finding that

Tapia and the tortfeasor were in the same employ pursuant to Weldy, the court

simply remanded with direction to dismiss for lack of subject matter jurisdiction,

not to determine whether Tapia actively participated in the horseplay.
199 The

Indiana Supreme Court granted Hensler' s petition for transfer on January 17,
1996, although its opinion has not been rendered as of this writing.

200
It remains

to be seen whether the issues raised in Judge Garrard's dissent will be resolved on

transfer.

C. Exclusive Remedy Statute of the Worker's Compensation Act:
Type of Claim and Class of Claimant Analysis

Two cases were decided in 1995 involving an analysis of the exclusive remedy
statute as it relates to specific types of injuries claimed and to a specific class of

claimant.

1. Terrell v. Rowsey.—In Terrell v. Rowsey,20] Terrell brought an action
against his employer, his supervisor, and his coemployees following his

termination after being caught drinking beer in his employer's parking lot in

violation of company policy. Terrell alleged that his supervisor "broke and
entered his car and trespassed upon his car . . . and that as a result of [his

and this court has consistently denied compensation to an injured employee who so participates."

Id. at 826 (emphasis added) (citing Weldy, 616 N.E.2d at 405).

197. Id. (Garrard, J., dissenting).

198. See Weldy, 616 N.E.2d at 404.

199. Tapia v. Heavner, 648 N.E.2d 1202, 1208 (Ind. Ct. App. 1995).

200. The appellee's petition to transfer cites the following as the basis for its petition:

The opinion of the court of appeals in this case is in error in that it conflicts with

numerous other opinions of the Indiana Court of Appeals as well as contravening recent

strong dicta of the Indiana Supreme Court as follows: (a) Martin v. Powell, (1985) Ind.

App., 447 N.E.2d 943, trans, denied - in which the court of appeals held that "in the

same employ" for purposes of co-worker immunity under the Indiana Worker's

Compensation Act (the "Act") requires the defendant co-worker to be acting within the

course of his employment at the time the plaintiff suffers a compensable injury ....

Tippmann v. Hensler, No. 02503-9603-CV-201 (Ind. Jan. 17, 1996) (appellee's petition to

transfer).

201

.

647 N.E.2d 662 (Ind. Ct. App. 1995).



1 170 INDIANA LAW REVIEW [Vol. 29:1139

supervisor's] tortious misconduct, Terrell suffered embarrassment, defamation and

loss of quiet enjoyment of his property."
202

The court affirmed the trial court's
judgment in favor of Terrell's employer, supervisor and coemployees, but in so
doing noted that the trial court erroneously found that it was without jurisdiction
over Terrell's action in light of the exclusive remedy statute. The court stated that,
because Terrell's claimed injuries of defamation, embarrassment and loss of quiet

enjoyment of property were not physical and did not represent loss of physical

function, they were not the type of injuries covered under the Worker's

Compensation Act. Thus, the exclusive remedy statute did not apply to remove

the case from the jurisdiction of the trial court.
203

2. Ransburg Industries v. Brown.—Possibly the most interesting case decided
in 1995 in the area of exclusive jurisdiction involved a case of first impression in

Indiana. In Ransburg Industries v. Brown,
204

the court was faced with resolving

the issue of whether the exclusive remedy statute bars a claim for prenatal injuries

inflicted in the work place.
205 An action was brought against defendant Ransburg

Industries ("Ransburg") by Rebecca and Brett Brown (the "Browns") after the
Browns' son Brandon died on the day of his birth. The Browns alleged that
Brandon's death was caused when Mrs. Brown fell ill after inhaling fumes while
painting floors for Ransburg during the first trimester of her pregnancy. The trial
court denied Ransburg' s motion for summary judgment on grounds that the
injuries causing Brandon's death did not invoke the exclusive remedy provision

of the Worker's Compensation Act.
206

The court again noted that the proper procedural vehicle for attacking the trial
court's jurisdiction was not through a motion for summary judgment, but rather
through a motion to dismiss pursuant to Trial Rule 12(B)(1).

207 The court then
proceeded to review the trial court's decision as though it were based upon the

denial of a motion to dismiss for lack of subject matter jurisdiction rather than a

denial of a motion for summary judgment.
208

Because this was a case of first

impression, the court sought guidance from other jurisdictions that considered the

issue of prenatal injury in the worker's compensation arena.
209

Essentially, the issue as to the applicability of the exclusive remedy statute was

resolved by determining whether Brandon's claim against Ransburg was

independent or derivative of Mrs. Brown's injury. The court first rejected

202. Id. at 664.

203. Id. at 665 (citing Perry v. Stitzer Buick GMC, Inc., 637 N.E.2d 1282 (Ind. 1994)).
204. 659 N.E.2d 1081 (Ind. Ct. App. 1995).

205. Id. at 1082.

206. Id.

207. Id. at 1082-83 (citing Perry, 637 N.E.2d at 1286; Mannon v. Howmet Transp. Serv.,

Inc., 645 N.E.2d 1135, 1136 (Ind. Ct. App. 1995)).

208. Id. at 1083.

209. Id. (citing Thompson v. Pizza Hut of America, Inc., 767 F. Supp. 916 (N.D. 111. 1991);

Namislo v. Akzo Chemicals, Inc., 620 So. 2d 573 (Ala. 1993); Pizza Hut of America, Inc. v. Keefe,

900 P.2d 97 (Colo. 1995); Cushing v. Timesaver Stores, Inc., 552 So. 2d 730 (La. Ct. App. 1989);

Bell v. Macy's California, 261 Cal. Rptr. 447 (1989)).



1996] WORKER'S COMPENSATION 1171

Ransburg's reliance upon a California case in which the court ruled that the child's

injury was derivative from the employee's injury when the child's injury resulted
from the employer's delay in securing medical attention for the pregnant

employee.
210 The Ransburg court recognized that no other jurisdiction had

followed the California analysis and turned instead to persuasive rationale from

other jurisdictions.
21 '

The common thread running through the cases from other jurisdictions
considered by the Ransburg court was the recognition that the claim of the child

was independent from any injury or claim of the employee-mother. In Thompson
v. Pizza Hut ofAmerica, Inc.,

2n
the employee's child was born with severe birth

defects after the pregnant employee was exposed to, among other fumes, carbon
monoxide as a result of a three day failure of the employer's ventilation system.

Like Ransburg, the employer in Thompson also defended on grounds that the
exclusive remedy provision of the Illinois worker's compensation laws "applied

because the child's injury [was] derived from the injury suffered by the mother in

the course of her employment."
213 The Illinois court, however, recognized a

distinction between those cases in which the exclusive remedy provision of the

Illinois worker's compensation laws worked to bar claims of spouses and children

flowing from the employee's injury, such as loss of consortium claims, and those

claims brought by the child based upon her independent prenatal injuries.
214

The Ransburg court found the reasoning of Cushing v. Time Saver Stores,
Inc.,

2 * 5
to be most persuasive in analyzing the distinction between a derivative or

independent cause of action by a child injured in utero. In Cushing, an employee-

mother suffered an injury after falling from a stack of boxes. The fall caused her

child to be born with severe birth defects.
216

The Cushing court brought the

distinction between derivative and independent actions out of the theoretical

vacuum with the following analysis:

The Act itself and all jurisprudence construing its various provisions, up
to this time, have been focused on injuries to employees, and resultant

losses by them and certain of their family members, based on the injuries

to the employees. With regard to the losses of the family members, these

might be economic, such as loss of support because the injured employee

was no longer coming home with a paycheck, or they might be intangible,
such as loss of consortium because the injured employee was no longer

there to participate in family life. However, these losses, while rightfully

termed "separate and distinct" and "independent" from those injuries

sustained by the employee, always hinged upon the injuries of the

2 1 0. Id. (citing Bell, 26 1 Cal. Rptr. at 454-55).

211. Id.

212. 767 F. Supp. 916 (N.D. 111. 1991).

213. Ransburg, 659 N.E.2d at 1083 (citing Thompson, 767 F. Supp. at 918).

214. Id.

215. 552 So. 2d 730 (La. Ct. App. 1989).

2 1 6. Ransburg, 659 N.E.2d at 1 084 (citing Cushing, 552 So. 2d at 73 1 ).



1 1 72 INDIANA LAW REVIEW [Vol. 29: 1 1 39

employee. Because Dad or Mom suffered an injury, the family suffered
a loss based on that injury. Thus, the claims of the family members were
derivative of the employee's injury, even though the language utilized in

the cases recognized an individual loss sustained by each family member,
albeit one for which no claim could be asserted.

Such is not the case in this instance. . . . Here, the employee's child has

alleged injuries which are in no way derivative of the mother's injury.
Whether Mom is there to continue bringing home a paycheck or to
participate in the child's life has no relevance to this child's alleged brain

damage.
217

With this guidance from other jurisdictions, the Ranshurg court next analyzed

the facts of the case under Indiana law, first noting that the Indiana Supreme Court
had previously recognized a cause of action based upon a pre-conception tort.

218

The Ranshurg court rejected the employer's argument that Brandon's injury and
death were derivative from the mother because the child was exposed to the

harmful fumes through Mrs. Brown. Relying on Cushing, the Ransburg court

noted that "the inquiry of whether a claim is derivative focuses not on how the
injury occurred but rather on whether the claimed damages are based upon the
employee's injury."

219

The court concluded that the Browns' claim was based solely upon the injury
incurred by Brandon and was in no way dependent on Mrs. Brown's claim.220 The
court thus reasoned that the wrongful death claim of Brandon, unlike a loss of

consortium claim, was not derivative of the mother's claim and was therefore not
barred by the exclusive remedy provision of the Worker's Compensation Act.

221

In a footnote, the court acknowledged a rather creative argument by Ransburg that

the state tort liability should be preempted by Title VI of the Civil Rights Act
because Ransburg would be prevented from implementing a gender-based fetal

protection policy, but found that the facts of Ransburg did not indicate that

Ransburg was prevented from complying with both federal and state law

requirements.
222 A petition for transfer was filed on May 3, 1996, but as of this

writing the Indiana Supreme Court has yet to take action on the same. Thus, the

Ransburg decision indicates that if a child injured in utero can demonstrate an

independent cause of action, he or she should be allowed to proceed with a

negligence claim against the employer of his or her mother.

217. Id. (citing Cushing, 552 So. 2d at 731-32).

218. Id. (citing Walker v. Rinck, 604 N.E.2d 591 (Ind. 1992)).

219. Id. at 1085.

220. Id. But see Nelson v. Denkins, 598 N.E.2d 558, 563 (Ind. Ct. App. 1992) ("A cause

of action for loss of consortium derives its viability from the validity of the claim of the injured

spouse against the wrongdoer.").

221. Ransburg, 659 N.E.2d at 1085-86.

222. Id. at 1086 n.7.