Court of Appeals Denies Application of Judicial Estoppel in Alternate Medical Care Proceeding
The Court of Appeals in NID, Inc. v. Monahan, No. 14-0292 (Iowa App. March 25, 2015) grappled with questions of res judicata and judicial estoppel in the context of an alternate medical care proceeding. The court concluded that res judicata and judicial estoppel did not apply and refused to enter sanctions against the defendants for their failure to provide care.
The court begins by noting that the proceeding was "unnecessarily Dickensian in duration and procedural complexity." Claimant had suffered an injury to his shoulder in 2007 and received treatment for that injury. He filed a petition almost two years after the injury and at hearing the parties stipulated that claimant had suffered an injury that arose out of his employment. The parties disputed whether claimant's medical expenses were connected to the injury. After the arbitration hearing but before decision, claimant treated, on his own, with Dr. Neff, who recommended surgery for the left shoulder.
Before the arbitration decision was issued, claimant filed for alternate medical care. Defendants disputed liability, and the AMC petition was dismissed. The arbitration decision was subsequently issued and found only that a left hand injury was work related. The decision also ordered that claimant was entitled to alternate medical care in the form of a second opinion for the shoulder injury by an orthopaedist of claimant's choosing. The decision also found there was no permanent disability. On appeal the arbitration decision was affirmed in April 2012.
On April 13, 2013, a second application for alternate medical care was filed, requesting that the agency order defendants to send claimant to Dr. Neff and requesting sanctions. Defendant again indicated they were denying liability and the agency dismissed the alternate medical care petition. Claimant sought rehearing, claimant that the earlier decisions of the agency were preclusive as to the issue of work relatedness. The agency granted the request for rehearing and found that defendants were barred by res judicata from contending they were not liable for the shoulder problems. Attorney's fees and costs were imposed as a sanction.
On judicial review, the defendants argued that the agency erred in ruling on the merits of the alternate medical care request when causation was an issue, in determining causation, in using the alternate medical care proceeding to enforce the appeal decision and in awarding attorney's fees. The district court held that the application of res judicata was error because the shoulder injury had been stipulated to, so it was never actually litigated. The district court also found that the alternate medical care proceeding should have been dismissed because causation was still at issue. The court remanded to the agency for a hearing on causation. Post-trial motions by both parties were denied.
On appeal, the Court of Appeals first finds that res judicata did not apply. By this point in the proceedings, claimant had agreed that res judicata did not apply, but urged the application of judicial estoppel. The court found there was no basis to apply judicial estoppel, as defendants had never stipulated to causation and liability. The court noted that claimant was unable to identify where the stipulation could be found in the record. The only stipulation was that claimant had suffered a work-related injury. The court concluded that "an employer may properly admit to an injury arising out of and in the course of employment while still contesting liability for all of the consequences and any disability claimed to result from such injury." Because the employer had not asserted inconsistent opinions, there was no reason for the court to apply judicial estoppel.
The court next addressed the use of the alternate medical care proceeding as an enforcement proceeding. The court found that the appropriate action for claimant to have taken was to file an action for enforcement under section 86.42 of the Code. The court also reversed the sanctions that had been awarded by the agency. Finally, the court concluded that the alternate medical care proceeding should have been dismissed.
In a coda to the decision the court denied the employer's motion to strike certain portions of the appendix not in the record and certain portions of the reply brief referring to material outside of the record. The court indicated it had not considered those parts of the appendix not in the record.
The court begins by noting that the proceeding was "unnecessarily Dickensian in duration and procedural complexity." Claimant had suffered an injury to his shoulder in 2007 and received treatment for that injury. He filed a petition almost two years after the injury and at hearing the parties stipulated that claimant had suffered an injury that arose out of his employment. The parties disputed whether claimant's medical expenses were connected to the injury. After the arbitration hearing but before decision, claimant treated, on his own, with Dr. Neff, who recommended surgery for the left shoulder.
Before the arbitration decision was issued, claimant filed for alternate medical care. Defendants disputed liability, and the AMC petition was dismissed. The arbitration decision was subsequently issued and found only that a left hand injury was work related. The decision also ordered that claimant was entitled to alternate medical care in the form of a second opinion for the shoulder injury by an orthopaedist of claimant's choosing. The decision also found there was no permanent disability. On appeal the arbitration decision was affirmed in April 2012.
On April 13, 2013, a second application for alternate medical care was filed, requesting that the agency order defendants to send claimant to Dr. Neff and requesting sanctions. Defendant again indicated they were denying liability and the agency dismissed the alternate medical care petition. Claimant sought rehearing, claimant that the earlier decisions of the agency were preclusive as to the issue of work relatedness. The agency granted the request for rehearing and found that defendants were barred by res judicata from contending they were not liable for the shoulder problems. Attorney's fees and costs were imposed as a sanction.
On judicial review, the defendants argued that the agency erred in ruling on the merits of the alternate medical care request when causation was an issue, in determining causation, in using the alternate medical care proceeding to enforce the appeal decision and in awarding attorney's fees. The district court held that the application of res judicata was error because the shoulder injury had been stipulated to, so it was never actually litigated. The district court also found that the alternate medical care proceeding should have been dismissed because causation was still at issue. The court remanded to the agency for a hearing on causation. Post-trial motions by both parties were denied.
On appeal, the Court of Appeals first finds that res judicata did not apply. By this point in the proceedings, claimant had agreed that res judicata did not apply, but urged the application of judicial estoppel. The court found there was no basis to apply judicial estoppel, as defendants had never stipulated to causation and liability. The court noted that claimant was unable to identify where the stipulation could be found in the record. The only stipulation was that claimant had suffered a work-related injury. The court concluded that "an employer may properly admit to an injury arising out of and in the course of employment while still contesting liability for all of the consequences and any disability claimed to result from such injury." Because the employer had not asserted inconsistent opinions, there was no reason for the court to apply judicial estoppel.
The court next addressed the use of the alternate medical care proceeding as an enforcement proceeding. The court found that the appropriate action for claimant to have taken was to file an action for enforcement under section 86.42 of the Code. The court also reversed the sanctions that had been awarded by the agency. Finally, the court concluded that the alternate medical care proceeding should have been dismissed.
In a coda to the decision the court denied the employer's motion to strike certain portions of the appendix not in the record and certain portions of the reply brief referring to material outside of the record. The court indicated it had not considered those parts of the appendix not in the record.
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