LYLE COLLEDGE,			)
				)
Employee,			)	DECISION AND ORDER
 Applicant,			)
				)	AWCB Case Nos.	8622677
v.				)		8719258
				)
ALASKA FENCE CO., INC.,	)	AWCB Decision No. 90-0044
				)
Employer,			)	Filed with AWCB Fairbanks
				)	March 14 1990
and				)
				)
PROVIDENCE WASHINGTON,		)
				)
Insurer,			)
				)
v.				)
				)
DIMOND FENCE CO.,		)
				)
Employer,			)
				)
and				)
				)
INDUSTRIAL INDEMNITY		)
				)
Insurer,			)
 Defendants.			)
				)

This claim for permanent partial disability (PPD) benefits and a determination of liability was heard at Fairbanks, Alaska on January 30, 1990. The employee was represented by attorney Chancy Croft and Paralegal Edgar Husted. The first injury-related employer Alaska Fence Company and its insurer, Providence Washington (hereafter Alaska Fence), was represented by attorney Michael McConahy; attorney Elise Rose represented the second injury-related employer Dimond Fence Company and its insurer Industrial Indemnity (hereafter Dimond Fence). The record closed when we next met on February 13, 1990 after all depositions were received, and the parties' settlement discussions were unsuccessful.

This case arises out of 1986 and 1987 injuries to the employee's low back. Originally 27 years ago, however, the employee injured his low back and subsequently had a laminectomy. He returned to his employment as an ironworker, working until 1979. At that time, he injured his neck and in May 1987, had surgery. The surgery was performed by George Brown, M.D. Due to the 1979 neck injury, the employee received a settlement based on his loss of wage-earning capacity in the amount of $30,000.00, He returned to work with Dimond Fence (the parent company of Alaska Fence) in lighter duty employment. He has never returned to the heavy duty labor of an ironworker, but has continued working since 1980 with Dimond Fence in a lighter duty supervisory capacity. He has worked in a seasonal position from May through November, and the amount of work done and the money earned have varied in relation to the amount of work available to Dimond Fence. In the years from 1986 on, less work has been available due to the decrease in the Fairbanks population and the resulting decrease in available work for the employer, Dimond Fence.

At the hearing, the employee submitted a letter form J.N. Carroll, Business Manager of Ironworkers Local 751, which said the employee could have worked over 500 hours per year out of the local union hall over the last two years if he had not been disabled. Nevertheless, the employee testified he has not been dispatched out of the union hall since 1983.

The employee testified that his earnings have decreased since the time of his injury. William Westervelt, owner of Dimond Fence testified that available fence-building work has declined since 1987 due to the decline in the Fairbanks economy. Accordingly, he has experienced a decline in work and, therefore, earnings available for his employees.

On August 27, 1986, the employee was performing his duties with Alaska Fence, a subsidiary of Dimond Fence which has since ceased operations. His duties were primarily directing crews who were putting up chain link fence. These duties included dispatching, supervision of crews and paper work. On that date, the employee was directing the crew in the yard of Alaska Fence. As he leaned over, a roll of chain link fence fell from a truck and landed on his upper back, causing him to hyperextend his back. At the time, the employee believed he had been injured and discussed the matter with his employer. He was able to continue with his duties, however, and continued to work for Alaska Fence.

Ultimately, however, the pain the employee was experiencing worsened and on October 21, 1986 he sought treatment with Dr. Brown. Dr. Brown informed him that he believed the employee had suffered a possible herniated disc as a result off the August 1986 incident. Dr. Brown, who knew the employee was not working because he had completed the fencing season, recommended conservative care. The employee's problems continued and he again sought medical care in January 20, 1987. Dr. Brown treated the employee with conservative care.

In the spring of 1987, the employee returned to his employment with Dimond Fence. He continued to work until August 24, 1987. On that day, he got a rock in his boot, He returned to the office and removed his boot in order to get the rock out. When he put his boot back on, he experienced sharp pain in his back and immediately sought treatment from Dr. Brown. Dr. Brown diagnosed a herniated disc and on August 27, 1987 performed a lumbar laminectomy and discectomy.

Dr. Brown is the employee's treating physician. Dr. Brown's notes reflect and his testimony confirms that the employee's condition was significantly better after the August 27, 1987 surgery, compared with his condition from August 1986 to August 1987.

On April 4, 1988 the employee was seen by John Joosse, M.D. Dr. Joosse, in his April 4, 1988 report, letter of April 4, 1988, and in his deposition stated that, in his opinion, the employee injured himself on August 26, 1986. He said the August 1987 incident was not a significant factor in the applicant's need for medical care and in his resulting impairment. Dr. Joosse indicated that the herniation of the disc could have occurred any time and that the August 1987 incident was not significant. Dr. Brown, upon review of Dr. Joosse's reports, essentially concurred in his opinion.

Finally, at Alaska Fences' request, the employee saw Christopher Horton, M.D., on January 16, 1990. Dr. Horton also agrees that the August 1987 incident was not significant.

I. Permanent Partial Disability

a. Unscheduled PPD

Compensation for employee's PPD benefits is provided in former AS 23.30.190. Subsection 190(a)(20) applies to "unscheduled" injuries such as employee's back injury.

Our Supreme Court has repeatedly emphasized that disability compensation in Alaska under former subsection 190(a)(20) is a function of lost earning capacity:

Vetter v. Alaska Workmen's Compensation Board, 524 P.2d 264, 266 (Alaska 1974) (emphasis added). See also Bailey v. Litwin Corporation, 713 P.2d 249, 253 (Alaska 1986) and Ketchikan Gateway Borough v. Saling, 604 P.2d 590, 594 (Alaska 1979). Regarding the determination of wage-earning capacity, AS 23.30.210 provides:

Our Supreme Court has held that "other factors" include age, education, availability of suitable employment in the community, the employee's future employment intentions, trainability, and vocational rehabilitation assessment and training. Bignell v. Wise Mechanical Contractors, 651 P.2d 1163, 1167 (Alaska 1982); Hewing v. Peter Kiewit and Sons, 586 P.2d 182, 186 (Alaska 1978); Vetter v. Alaska Workmen's Compensation Board, 524 P.2d 264, 266 (Alaska 1974); Hewing v. Alaska Workmen's Compensation Board, 512 P.2d 896, 899 (Alaska 1973).

Thus an employee must suffer both a permanent medical impairment and a loss of earning capacity to be entitled to unscheduled permanent partial disability benefits. An employee's actual post-injury earnings are a reliable basis for estimating capacity. Hewing, 586 P.2d at 186 (citing 2 A. Larson, The Law of Workmen's Compensation §57.21 at 10.39 to 10.40 (1976)). It is not necessary to precisely compute an employee's lost earning capacity but, rather, to fairly represent lost earning capacity. Bailey 713 P.2d at 256.

In Brunke v. Rogers and Babler, 714 P.2d 795 (Alaska 1986), our Supreme Court held that an employee has the burden of proving loss of wage-earning capacity for purposes of determining his or her PPD benefits for an unscheduled injury. The court concluded as follows:

Id. at 801.

According to the employee's W-2 forms, he earned $53,296 in 1984, $53,595 in 1985, $39,379.67 in 1986, $17,764.84 in 1987, $31,594.40 in 1988 and $24,452.02 in 1989. According to his 1040 forms, his adjusted gross earnings were reduced in each of those years by self-employment income losses. His adjusted gross income was $45,479 in 1984, $31,314 in 1985, $20,090 in 1986, $20,019 in 1987, and $17,748 in 1988. His 1989 adjusted gross income was not yet available at the time of the hearing.

In any event, assuming the employee did experience a substantial reduction in earnings after his 1986 or 1987 dates of injury, we must decide if his earnings received at the time of his injury would have continued through his period of disability if he had not been injured. Brunke, 714 P.2d 795.

The parties agree the employee has not worked on the North Slope since 1980. Additionally, he has not worked on structural steel or tied rebar since 1980. He has not worked to construct a steel building since 1981, except as a supervisor. Apparently, since the employee's 1979 injury, he has not been able to do heavy steel work. Meanwhile, his earnings as a fence building supervisor have generally declined since the Fairbanks economy began to deteriorate in 1986.

Based on our review of the record, we find that if the employee has suffered a loss in wages received since 1986 it is because of the downturn in the economy, and not because of the 1986 or 1987 injuries. Accordingly, we find the employee's claim for unscheduled PPD benefits must be denied.

b. Scheduled PPD

The employee claims entitlement to former AS 23.30.190(a) scheduled benefits due to his laminectomy and the loss of the use of his leg due to numbness. We disagree with the employee that he is entitled to scheduled loss of the use of his leg under subsection 190(a)(2). His leg was never

injured.

In Providence Washington Ins. Co. v. Grant, 693 P.2d 872 (Alaska 1985) Grant was paid both scheduled and unscheduled benefits due to multiple injuries; injuries to both his back and his leg. In Ratliff v. AWCB, 721 P.2d. 1138 Alaska 1986), Ratliff injured only his leg and the court found only scheduled benefits were awardable. In this case, the employee has suffered an injury only to his back. Accordingly, based on the court's analysis in Ratliff we find the employee's claim for an additional recovery under subsection 190(a)(2) for the loss of the use of the leg must be denied.

Finally, the employee claims entitlement to scheduled PPD benefits under subsection 190(a)(19)(B) which provides for compensation up to $10,000 to pay for "Partial or total loss of use of a part or function of the body not otherwise provided for under this section."

On August 17, 1987, Dr. Brown performed a lumbar laminectomy and discectomy. In his deposition, Dr. Brown agreed with Dr. Joosse who indicated the employee has experienced approximately a 15-20 percent impairment of the whole man as a result of the back injury and surgery. The doctors also agreed that this rating was partially based on the employee's right leg symptoms.

Based on our review of the record, we find the employee should be compensated under subsection 190(a)(19)(B) for the partial loss of a bodily function not otherwise provided for under section 190(a). We find the sum of $10,000 to be proper and equitable compensation for the laminectomy and discectomy.

II. Determination of Liability Under the Last Injurious Exposure Rule

The Alaska Supreme Court has repeatedly held that "injury" under the Alaska Workers' Compensation Act includes aggravations or accelerations of pre-existing conditions. See, e.g., Burgess Construction v. Smallwood, 623 P.2d 312, 316 (1981 Alaska) (Smallwood II.); Thornton v. Alaska Workmen's Compensation Board, 411 P.2d 209, 210 (Alaska 1966). When multiple injuries are involved liability for disability must be decided under the last injurious exposure rule. Ketchikan Gateway Borough v. Saling, 604 P.2d 590 (Alaska 1979). This rule "imposes full liability on the employer or insurer at the time of the most recent injury that bears a causal relation to the disability." Id. at 595. In United Asphalt Paving v. Smith, 660 P.2d 445, 447 (Alaska 1983), the court stated:

Whether subsequent employment "aggravated, accelerated, or combined with" a pre-existing condition is a question of fact "usually determined by medical testimony." Smallwood II, 623 P.2d at 316 (quoting Thornton, 411 P.2d at 210). Whether an aggravation was a substantial factor must be determined by the following test: "[I]t must be shown both that the [disability] would not have happened 'but for' the employment and that the [employment] was so important in bringing about the disability that reasonable men would regard it as a cause and attach responsibility to it." State v. Abbott, 498 P.2d 712, 717 (Alaska 1972).

In applying the last injurious exposure rule we must first determine whether the presumption of compensability attaches against the last employer. See Providence Washington Insurance Co. v. Bonner, 680 P.2d 96 (Alaska 1984).

AS 23.30.120(a) provides in pertinent part: "In a proceeding for the enforcement of a claim for compensation under this chapter it is presumed, in the absence of substantial evidence to the contrary, that (a) the claim comes within the provision of this chapter . . ."

In Smallwood II the Alaska Supreme Court held that the employee must establish a preliminary link between the injury and the employment. 623 P.2d at 316. Once the employee makes a prima facie case of work-relatedness the presumption of compensability attaches.

To overcome the presumption of compensability, the employer must present substantial evidence that the injury was not work-related. Id. The court has consistently defined substantial evidence as "relevant evidence a reasonable mind might accept as adequate to support a conclusion." Miller v. ITT Arctic Services, 577 P.2d 1044, 1046 (Alaska 1978). In Fireman's Fund American Insurance Company v. Gomes, 544 P.2d 1013, 1016 (Alaska 1976), the court explained two possible ways to overcome the presumption: 1) producing affirmative evidence the injury was not work-related; or 2) eliminating all reasonable possibilities the injury was work-related. If the employer produces substantial evidence the injury was not work-related, the presumption drops out, and the burden of proving all elements of the claim shifts back to the employee. 623 P.2d at 316. The evidence to raise or rebut the presumption must be viewed in isolation from the other evidence. Veco, Inc. v. Wolfer, 693 P.2d 866, 870 (Alaska 1985).

Based on Bonner we first consider the last employment with Dimond Fence. It is undisputed the employee was injured at work. Nevertheless, he did not file a notice of injury in a timely manner. Accordingly, we find his claim against Dimond Fence does riot enjoy a presumption of compensability and, assuming we excuse the delay the claim, his claim must be proven by a preponderance of evidence. AS 23.30.120(b).

All the doctors in this case uniformly agree that the incident of removing the rock from the employee's boot was not a significant aggravation causing his disc to herniate. All the doctors agree that the substantial causal factor in the herniation was the 1986 accident which happened at Alaska Fence. Accordingly, we conclude the claim against Dimond Fence has not been proven by a preponderance of evidence and the claim against Dimond Fence must be denied.

We turn now to the claim against the first employer, Alaska Fence. Again there is no dispute that the employee was injured at work, but again he did not file a timely notice of injury. Given that he was able to continue working and did not know the severity of the injury until much later, we excuse the delay in filing the claim. Nevertheless, the claim against Alaska Fence must be proven by a preponderance of evidence. AS 23.30.120(a)(1); 120(b).

As stated above, all the doctors involved in this case attribute the employee's herniated disc to the accident and injury which occurred while he was working for Alaska Fence. Given that the great weight of medical opinion weighs in favor of finding Alaska Fence responsible for this claim, we find the case against Alaska Fence is proven by a preponderance of the evidence. Alaska Fence shall pay the employee's workers' compensation benefits under the last injurious exposure rule.

III. Attorney Fees, Costs, Interest

We have found this claim for workers' compensation benefits compensable. The parties agree that attorney fees, costs and interest are, therefore, payable. In the event the parties are unable to reach agreement on these amounts owed, we reserve jurisdiction to resolve dispute.

1. Alaska Fence and its workers' compensation insurance carrier, Providence Washington, shall pay the employee $10,000 in PPD benefits pursuant to former AS 23.30.190(a)(19)(B).

2. Alaska Fence and Providence Washington are responsible for the balance of the employee's workers' compensation benefits under the last injurious rule.

3. Alaska Fence and Providence Washington shall pay the employee's attorney fees, costs and interest. We reserve jurisdiction to resolve disputes.

DATED at Fairbanks, Alaska, this 14th day of March, 1990.

ALASKA WORKERS' COMPENSATION BOARD

/s/ Fred G. Brown
Fred G. Brown, Designated Chairman

/s/ Joe J. Thomas
Joe J. Thomas, Member

FGB/ml

If compensation is payable under terms of this decision, it is due on the date of issue and penalty of 20 percent will accrue if not paid within 14 days of the due date unless interlocutory order staying payment is obtained in Superior Court

APPEAL PROCEDURES

A compensation order may be appealed through proceedings in the Superior Court brought by a party in interest against the Board and all other parties to the proceedings before the Board, as provided in the Rules of Appellate Procedure of the State of Alaska.

A compensation order becomes effective when filed in the office of the Board, and unless proceedings to appeal it are instituted, it becomes final on the 31st day after it is filed.

CERTIFICATION

I hereby certify that the foregoing is a full, true and correct copy of the Decision and Order in the matter of Lyle Colledge, employee/applicant; v. Dimond Fence Co., employer; and Industrial Indemnity, insurer; v. Alaska Fence Co., Inc., employer; and Providence Washington, insurer/defendants; Case No. 8719258 and 8622677; dated and filed in the office of the Alaska Workers' Compensation Board at Fairbanks, Alaska this 14th day of March, 1990.

Clerk

SNO