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Smith v. State

Supreme Court of Idaho

June 7, 2019

KEVIN R. SMITH, Claimant-Appellant,

          Appeal from the Industrial Commission of the State of Idaho.

         The Industrial Commission's order is affirmed.

          Starr Kelso Law Office, Coeur d'Alene, for appellant. Starr Kelso argued.

          Jones, Brower & Callery, PLLC, Lewiston, for respondent. Thomas W. Callery argued.

          BRODY, Justice.

         Kevin Smith appeals from an order of the Idaho Industrial Commission that concluded the Idaho Industrial Special Indemnity Fund (ISIF) was not liable to him for worker's compensation benefits. The Commission determined that Smith failed to prove he was totally and permanently disabled under both the 100% method and the odd-lot worker method. He also appeals from a motion for reconsideration that was denied by the Commission, where he alleged that the Commission determined disability at a future date rather than the date of the hearing, that it improperly interpreted a report, and that it improperly considered an excluded exhibit. We affirm the Commission's order.


         In July 1997, a second-story balcony railing Kevin Smith was leaning on gave way, plunging him towards the ground and fracturing both his heels. Dr. Edward Tapper performed surgery on Smith's left heel and put casts on both feet. Smith could not walk for over a year, nor could he work in general construction as he was doing before the accident. A few months after the injury, Smith was evicted from his apartment and was forced to live in a car with his wife and infant.

         After his injuries healed he continued experiencing pain in his heels, leading him to realize that he would be unable to work at a job that required copious amounts of standing and walking, so he set out to become a plumber. He obtained employment as an apprentice and eventually become a skilled plumber. Smith discontinued follow-up appointments for his heels with Dr. Tapper in 1998 upon moving to Reno, Nevada, where he continued working as a plumber. While working in Reno, Smith consistently worked as a plumber but changed employers frequently.

         Not wanting to raise a family in Reno, Smith moved his wife and two children to Coeur d'Alene, Idaho, in 2006, and began working as a service manager for a plumbing company. A couple months into employment, Smith slipped on ice while working and injured his left wrist. Dr. Richard Mattis with North Idaho Physicians diagnosed Smith with a left wrist sprain accompanied by a possible fracture, treating him with pain medications and a splint. Smith returned to work on light duty but continued having pain in his left wrist and fingers. After physical therapy failed to relieve the pain, he was referred to Dr. Peter Jones, a hand and wrist surgeon, who opined that exploratory surgery of the wrist was needed. Dr. Joseph Welch, a plastic surgeon, conducted a review of Smith's injury and suggested that surgery not be undertaken until the wrist had a longer time to heal. Nevertheless, in July of 2007, Dr. Jones performed surgery on Smith's wrist and removed a fracture fragment.

         After Smith's surgery, his employer no longer had a need for his position and fired him. Smith attempted a small plumbing repair in his own home after recovering and discovered that he could hardly use a screwdriver without pain in his wrist. Dr. Jones noted that Smith was struggling with depression after his wrist injury because of apparent concerns of future employability. Smith underwent an independent evaluation with Dr. Brinkman, a plastic surgeon, who recommended that Smith see a psychologist for treatment of depression. Smith was authorized by the employer's insurance for five psychiatric visits with Dr. David Wait, who diagnosed Smith with "major depression, single episode, severe." Dr. Wait noted that it appeared Smith's depression stemmed from "his current inability to work," and suggested individual therapy and antidepressants as treatment. Smith was prescribed Celexa and referred to a licensed clinical professional counselor, Emily Hart, meeting with her three times.

         On December 12, 2007, Dr. Welch conducted an independent medical examination on Smith and determined that his wrist was now fixed and stable, and that his left upper extremity had a 9% permanent impairment. Dr. Welch also observed that Smith's severe depression was likely a result of his wrist injury, and that he would not be able to return to work without his psychiatric issues first being addressed. After this examination, Smith's worker's compensation benefits exhausted and he was referred to the Idaho Department of Health and Welfare Regional Mental Health Services for psychiatric care. He began treatment with Regional Mental Health Services in February 2008 for major depression disorder. He began receiving counseling and treatment for depression by Dr. Rhodes and other licensed counselors.

         In May 2008, still unemployed and being treated for depression, Smith became violently angry with his wife during a marital dispute. He was arrested and taken to the hospital on a police hold. Dr. Eric Heidenreich performed a psychiatric evaluation, determined he was depressed, and released him after a day. Smith denied any use of illegal substances when asked, but tested positive for marijuana while in the care of the hospital.

         Smith continued treatment with Regional Mental Health Services after this incident, but he began harboring significant resentment and anger towards his wife for calling the police during their dispute, and for not working at a job that paid well through his unemployment. He was also not satisfied with the medicine the psychiatrist was prescribing, trying five different medications and rejecting them all. In August 2008, Dr. Marie Parkman, a psychologist, prepared a report concerning Smith's treatment at Regional Mental Health Services and concluded that he had not progressed very far in his treatment. She opined that he was having difficulties with major depression and ongoing panic attacks because of difficulties in personality functioning. She also stated that he would be a good candidate for vocational rehabilitation because of his above-average intelligence, but his ongoing litigation was complicating his recovery from depression. In her report, Dr. Parkman also noted that Smith was untruthful about his marijuana use because he reported only smoking marijuana as a teenager, but tested positive for marijuana in his urine twice and thereafter confessed that he received a ticket in Oregon for possession of marijuana. She believed that marijuana use was probably exacerbating Smith's mood difficulties.

         On October 27, 2008, a hearing was held before Referee Alan Taylor with the Industrial Commission of the State of Idaho to determine whether Smith was entitled to benefits for psychological injuries from his wrist accident pursuant to Idaho Code section 72-451. Kevin Smith testified at the hearing, and a June 25, 2008 deposition was introduced as an exhibit. Through Smith's testimony, it was revealed that he had been untruthful towards many of his health care providers. Specifically, he failed to tell providers-and lied during his deposition- that he had served in the U.S. Army and had been dishonorably discharged due to marijuana use. Smith also admitted that he told providers that he had done drugs in Holland, when he has never actually been to Holland. He also had been untruthful to Dr. Wait about substance abuse because he "didn't open up fully to him." He also admitted that he was not being honest at all with his counselor Emily Hart because he thought her attractive and wanted to impress her with a fantasy alter-ego, telling her that he had changed his name, that he had done exciting things in Holland, and that he had a history of committing crimes.

         After the hearing, a deposition was conducted of the Employer/Surety's psychologist, Dr. Ronald Klein. The deposition was thereafter admitted, along with a psychological evaluation of Kevin Smith. In Dr. Klein's report, he concluded that "[t]he depressive symptomatology noted by treaters and IME evaluators alike is not a product of his wrist injury . . . They have been characteristic of his functioning for the past 20 years." Instead of diagnosing him with major depression like most other treaters, Dr. Klein diagnosed Smith with adjustment disorder and mixed personality disorder with emotionally dependent and narcissistic features. He explained that Smith functions like a maladjusted child and is "impulsive, self-focused, oblivious to other's needs, and irritated at being held accountable for his actions." Dr. Klein further explained that Smith tells falsehoods because he reacts to the impulse of the moment. Smith's self-perception in life centers around four main failure experiences: (1) his dishonorable discharge from the Army; (2) his heel injury in 1997; (3) his wrist injury in 2007; and, (4) his arrest in 2008 wherein he tore up his home. In Dr. Klein's opinion, the reason Smith was suffering from depression and not working was because he "has something to pin his failure in life on." Ultimately, Dr. Klein concluded that "[t]he 'therapy' for [Smith] is to get him back to work, either by re-offering vocational assistance or by closing his claim and thereby creating an incentive to resume work."

         Dr. Tim Rehnberg, a psychologist hired by Smith, also reviewed medical records and conducted interviews with Smith, diagnosing him with adjustment disorder with anxiety and chronic depressed mood, pain disorder, and mixed personality disorder. His opinion was that Smith's wrist injury had a causal relationship with his psychological condition, and that he had no substance abuse issues at the time of testing. During his deposition, Dr. Rehnberg admitted that he did not review the entirety of Smith's medical records. While he thought Smith was definitely immature, he thought that Dr. Klein's use of the term "maladjusted child" was harsh. Dr. Rehnberg also stated that he thought Smith was young and smart enough that he should be in vocational rehabilitation, and that returning to work would alleviate a number of Smith's problems.

         On April 27, 2009, Referee Alan Taylor recommended to the Commission that Smith had failed to prove an entitlement to benefits for psychological injuries stemming from his wrist accident, and the Industrial Commission adopted his findings and recommendation the same day. In his findings, Referee Taylor determined that Smith was not a credible witness because of his tendency to be intentionally untruthful, but corroborating evidence persuaded him that Smith's psychological conditions were real and genuine. Benefits were ultimately denied because, while Smith's wrist injury was a contributing factor to his psychological condition, it was not the predominate cause as required by Idaho Code section 72-451(3). The Commission denied a motion for reconsideration, wherein Smith contended that the Commission erred in discounting Dr. Rehnberg's opinion and placing more weight in Dr. Klein's. Smith was then granted a motion to dismiss his case without prejudice.

         Early in 2007, Smith was referred to the Industrial Commission Rehabilitation Division (ICRD), where he was found eligible for services. Dr. Welch performed a job site evaluation of his previous plumbing job on behalf of ICRD in December 2007, and concluded that Smith could not return to his same occupation as a plumber due to psychiatric issues, but medical stability was expected within six months. In December 2008, Smith stated he was applying for a position with Check 'N Go, and ICRD gave him a list of job leads and some example resume formats. In June 2008, Smith cancelled services with ICRD because he did not wish to pursue employment at that time, reporting that he planned to admit himself to an inpatient mental hospital. The final outcome of his ICRD case detailed Smith as being medically stable with a 9% left upper extremity permanent partial impairment with no permanent restrictions or limitations.

         In December 2008, Smith was awarded social security disability benefits, backdated to April 2008. In August 2009, Smith registered for classes with North Idaho College in Coeur d'Alene with the assistance of the Idaho Division of Vocational Rehabilitation (IDVR). He was given a dictation program and a computer to assist him in college due to his self-reported wrist pain. He was able to complete 47 college credits towards an associate's degree and only needs 13 additional credits to obtain it. Smith cancelled treatment with Regional Mental Health Services on October 31, 2009, because he thought that there was nothing more mental-health therapy could accomplish for him.

         In February of 2011, Smith sought counseling from North Idaho College for grieving and marital problems, where he was seen four times by a counselor. He also went to the emergency department and was prescribed anti-anxiety medication after finding out that his wife had been having an extra-marital affair. During his last meeting with the counselor in March of 2011, Smith was encouraged to go to a hospital. His wife abandoned him soon thereafter, leaving him to fend for himself with his two children. During this time, he withdrew from his English class and failed his Algebra and Chemistry classes. Stricken with grief, he relocated with his two children in early 2012, to Apple Valley, California, to live with his mother and siblings.

         Upon moving to California, Smith was voluntarily committed to a San Bernardino Mental Hospital at the suggestion of his family. Dr. Geetha Puri, M.D., diagnosed Smith with major depression caused largely by the stress of being separated from his wife. Another M.D. in San Bernardino, Dr. Trilok Shah, diagnosed him with major depressive disorder due to chronic pain from a previous fall injury and marital conflict. Smith was treated with medications and released three days later. He was thereafter counseled by Dr. Puri and a psychiatrist with Desert Behavioral Health with regular counseling sessions.

         In January 2012, Smith filed a worker's compensation complaint against the Industrial Special Indemnity Fund (ISIF) for being totally and permanently disabled due to a combination of his 1997 bilateral broken heels, his 2007 left wrist injury, and his pre-existing psychological issues, education level, and age. Smith's lawyer scheduled a functional capacity evaluation (FCE) for Smith with a company in California called Safety Works, in an attempt to find out what physical limitations Smith currently suffered from. The FCE report featured raw data from tests conducted on Smith's grip strength, lifting strength, and standing and walking ability, among other things. The report also had an unsigned Physician's Return-to-Work Voucher Report that concluded Smith could return to work with certain restrictions: (1) he could only grasp with his left hand for a total of 4 to 6 hours a day, and (2) he could not lift or carry at a height of 3 to 6 feet of an undisclosed weight for more than 1 hour a day. The FCE report also concluded that Smith could return to his regular plumbing occupation with the limitations listed above.

         A hearing was held before Referee Brian Harper on May 17, 2016, to determine whether Smith was totally and permanently disabled, and whether ISIF was liable under Idaho Code section 72-332. At the beginning of the hearing, exhibits were admitted, including the employability reports of both Dan Brownell, the vocational expert for Smith, and William Jordan, the vocational expert for ISIF. However, a dispute arose over the admission of ISIF's proposed Exhibit 17 that was handed to the Referee the morning of the hearing and was not disclosed to Smith during discovery. Smith objected to the admission of Exhibit 17 on the grounds that he had never seen the document before. Referee Harper suggested the possibility that Smith's lawyer had sent the document to ISIF's lawyer at some point, but Smith's lawyer responded that he would have to investigate if that were true (there was a possibility that the document came from the employer/surety). Smith's lawyer objected and stated that he would have attempted to track down the author of the report, Dr. Thaworn Rathana-Nakintara, an M.D., board-eligible psychiatrist, and attempt to get a copy of her notes, a copy of her education and training, and speak with other psychologists and counselors that Smith has interacted with to obtain their opinions of the reliability of the contents of Exhibit 17. Referee Harper excluded Exhibit 17, but kept a physical copy of it in case of an appeal, stating, "I will not consider it, I haven't read it, I don't intend to."

         At the hearing, Smith testified about his life in California. He explained that he lives in solitude and isolation over the fear of being asked about what he "does for a living." His days are spent taking his children to school, going to the library, and people watching. He lives in a duplex in Apple Valley, living only off the income from his Social Security Disability. Smith also explained that he was not at Safety Works for the 7.5 hours as reported on the FCE report, but was actually at the location for less than an hour. He also testified that he was not actually tested for his standing, walking, or climbing abilities. However, he also testified that he had not applied for a job since residing in California, had only been to the community college in the area once, and had only contacted the California Vocational Rehabilitation Department a few weeks before the hearing. He also had stopped attending mental health treatment because of a change in his health insurance, but was smoking medical marijuana that was prescribed to him by a doctor for chronic pain, insomnia, situational stress, and other ailments. Smith stated that he was very hopeful that he could return to the work force with the help of a vocational rehabilitation specialist in California.

         Dan Brownell, a vocational rehabilitation specialist, was deposed post-hearing regarding his admitted employability report. Brownell was of the opinion that it was futile for Smith to attempt to even look for work because of his pre-existing physical limitations combined with his psychological condition. He explained that but-for these psychological and physical limitations caused and exacerbated by Smith's industrial work injury, he could "once again tap into his ambition and strong work ethic once again and obtain employment." Brownell stated that the wrist and grip testing on the FCE seem consistent with Smith's past medical history, but he did not rely on the FCE in making his determination because he was not familiar with California FCEs and Smith's FCE appeared inconsistent. He did admit that if the FCE were valid, Smith would be able to perform medium duty work, and that the medical records he was relying on in his report were almost ten years old.

         William Jordan, a vocational rehabilitation specialist hired by ISIF, came to the opposite conclusion: "there is no combination of pre-existing impairment with the subsequent injury to cause total disability." Jordan's report stated that no doctors had given any permanent restrictions limiting his ability to work physically, and his counselors had suggested that employment would alleviate many of his psychological issues. In his report, Jordan explained that if he were to rely on Smith's self-reported disabilities, he would likely be incapable of any type of employment; however, due to Smith's "fidelity issues" with providers and others, Jordan discounted Smith's perceptions and attempted to "sort out the issues." Jordan also used the FCE report to conclude that Smith's ability to use his wrist had worsened, but overall the FCE reflected that Smith did not have any physical limitations that would render him incapable of work. Jordan's opinion was that employment-wise, Smith is young enough for re-training, that he is close to an associate's degree and intelligent enough to obtain it, that he is personable, and that he has demonstrated an ability to learn a skilled trade. With these skills and the size of the Apple Valley, California job market, Jordan reported that it would not be futile for Smith to seek employment.

         At the beginning of Jordan's post-hearing deposition, Smith's attorney objected to Jordan making any references to his employability report-admitted Exhibit 16-that referenced any portion of excluded Exhibit 17. Exhibit 16, Jordan's Employability Report, provided detailed summaries of Smith's medical history, including (as Smith's attorney details in his objection) the contents of the report of Dr. Thaworn Rathana-Nakintara, M.D., in Exhibit 17. Jordan utilized Dr. Thaworn Rathana-Nakintara's report as evidence that Smith was employable, because she concluded that "[Smith] would have no difficulties to be able to perform work activities on a consistent basis without special or additional supervision." Jordan used her findings to conclude that, "The most recent psychiatric evaluation outlines the Evaluee is capable of working with respect to his psychological condition."

         Referee Brian Harper issued his Findings of Fact, Conclusions of Law, and Recommendation on July 7, 2017, and the Industrial Commission adopted it the same day. Referee Harper considered the findings and exhibits from the previous hearing, and also overruled all objections made during the depositions. After considering all the evidence before him, Referee Harper concluded that Smith failed to prove he is totally and permanently disabled under both the 100% method and the odd-lot worker method because he is not totally disabled due to his wrist and ankle injuries alone, and his psychological problems appear to be a treatable, temporary condition. In arriving at this conclusion, Referee Harper relied on Jordan's Employability Report and stated, "Claimant's most recent psychiatric evaluation shows that from a psychological standpoint Claimant is able to work without limitations." A footnote was affixed to this statement, wherein Referee Harper distinguished properly considering Exhibit 16- Jordan's Employability Report-from excluded Exhibit 17:

The report referenced was prepared by Thaworn Rathana-Nakintara, M.D., on April 22, 2014. ISIF inadvertently failed to include this report with its exhibits, and discovered the mistake shortly before hearing. Claimant objected to the report's inclusion as part of ISIF's exhibits, since it was not disclosed as an exhibit in a timely fashion. The objection was sustained and the document was not admitted as a stand-along exhibit. However, Mr. Jordan, as a qualified expert, is entitled to rely upon the report, and the undersigned is entitled to rely on Mr. Jordan's findings, even with regard to the report in question. Experts may rely on inadmissible materials if they are of a type typically relied upon by experts in their field of expertise. IRE 703. This report so qualified and the undersigned finds the probative value of the report in the context of Mr. Jordan's analysis substantially outweighs its prejudicial effect. The report is not considered or relied upon by the undersigned independently of Mr. Jordan's analysis, but Mr. Jordan's analysis will be considered in its entirety.

         Referee Harper also addressed the disputed FCE and outlined Smith's contentions with its accuracy and validity. Due to Smith's fabrications and falsehoods, Referee Harper disregarded Smith's testimony about the testing behind the FCE. However, he did find that "[t]he FCE appears to be internally inconsistent, or if it is not inconsistent, its unfamiliar form makes it difficult to accurately interpret." He concluded that he would only consider the raw data in the report:

Since no one familiar with the report was deposed, the Referee is left to interpret it to the best of his ability. . . .
The unsigned voucher will not be considered, nor will conclusions in the report which show Claimant's predicted abilities over a six to eight hour workday. The raw data, including grip strength, lifting ability, shoulder and back movement ranges, and ankle range of movements, will be considered as that data carries more weight than Claimant's subjective comments to the contrary.

         Later in his findings, Referee Harper noted that Smith's major impediment to employment is his temporary psychological condition because "Mr. Jordan notes that physically [Smith] has the ability to work, as borne out by the medical, psychological, and FCE raw data records."

         On July 27, 2017, Smith filed a motion to reconsider with the Industrial Commission, arguing that Referee Harper erred in considering the contents of excluded Exhibit 17 and perhaps violated the canons of judicial conduct, that he exceeded his authority by interpreting the raw data found in the FCE report, and that the evidence presented showed Smith was totally and permanently disabled. The Industrial Commission denied the motion. The Commission began its reasoning by explaining that the only reason Exhibit 17 was excluded was because of a possibility that Smith had not been provided the document during discovery; but, "it seems quite possible that the document did in fact originate in a discovery response by Claimant" because of Smith's failure to challenge ISIF's statement in a response brief claiming the exhibit had in fact been provided by Smith through discovery. However, the exclusion and admissibility of Exhibit 17 was "much ado about very little" because Referee Harper was relying on the contents of Exhibit 16, which was admitted without objection at the May 17, 2016 hearing. Even if the reliance on Exhibit 16 and Referee Harper's overruling of Smith's objections during Jordan's deposition were error, the Commission determined it would be harmless error because of the overwhelming amount of evidence supporting Jordan's conclusions.

         The Commission next addressed Referee Harper's reliance on, and interpretation of, the disputed FCE. It discussed its puzzlement at why Smith would challenge the Referee's reliance on this report since it is the only medical evidence that arguably supported any permanent restrictions or limitations in Smith's working capacity. However, the Commission concluded that it did not believe Referee Harper erred in deciding to rely on the raw data to inform his judgment of Smith's limitations and restrictions. In regards to Referee Harper's impartiality, the Commission stated that, "Having thoroughly considered ...

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