2007-061. Stephen Olafson Appellant vs. State of Alaska Department of Transportation and Public Facilities Appellee.

• Case Date: October 25, 2007
• Court: Alaska

Alaska Workers Compensation Decisions 2007. Workers' Compensation Appeals Commission 2007-061. Stephen Olafson Appellant vs. State of Alaska Department of Transportation and Public Facilities Appellee Alaska Workers' Compensation Appeals CommissionStephen Olafson, Appellant, vs. State of Alaska, Department of Transportation and Public Facilities, Appellee.Decision No. 061October 25, 2007AWCAC Appeal No. 06-033AWCB Decision No. 06-0301 AWCB Case No. 199017083Final Decision and Order Appeal from Alaska Workers' Compensation Board Decision No. 06-0301, issued November 9, 2006, by the southcentral panel at Anchorage, Krista M. Schwarting, Chair, Patricia A. Vollendorf, Member for Labor, and S. T. Hagedorn,(fn1) Member for Management. Appearances: Michael J. Jensen, Law Offices of Michael J. Jensen, for appellant Stephen Olafson. Talis J. Colberg, Attorney General, and Joe Cooper, Assistant Attorney General, for appellee State of Alaska, Department of Transportation and Public Facilities.Commissioners: John Giuchici,Philip Ulmer,and Kristin Knudsen.This decision has been edtted to conform to technical standards for publication. By: Kristin Knudsen, Chair.(fn2) Stephen Olafson appeals the board's failure to strike Dr. Brooks's Second Injury Medical Examination (SIME) report. He objects to the SIME examination because the pre-hearing officer abused her discretion by failing to disqualify Dr. Brooks for failure to disclose potential conflicts of interest. He also asserts she was required to respect the parties' stipulation to substitute another physician. We agree that once the pre-hearing officer cancelled the SIME, she could not disregard the stipulation reached by the parties without good cause. The board failed to address this issue. The board failed to decide if Dr. Brooks had an actual, disqualifying conflict of interest and if the SIME report was the result of partiality. We vacate the board's order and remand with instructions to rehear the petition. I. FACTS AND PROCEEDINGS. Stephen Olafson injured his lower back in the course of employment for the State of Alaska in 1990, when he was 41 years old.(fn3) He had surgery;(fn4) he was paid compensation;(fn5) and, he was provided a re-employment benefits evaluation, which determined that he was not eligible for benefits. The determination was upheld by the board.(fn6) He moved to Washington,(fn7) where he still lived when these events occurred.(fn8) The State resumed payments to Olafson in 1999 following onset of back pain.(fn9 )He was paid temporary total disability almost continuously from July 2, 1999 to July 13, 2004, and he received a second lump sum payment of permanent partial impairment compensation of $17,500 paid in July 2004.(fn10) During his period of temporary disability, Olafson underwent two additional lower back surgeries.(fn11) He filed a claim for permanent total disability compensation on May 30, 2005.(fn12) The State controverted(fn13 )and answered the claim on June 22, 2005.(fn14) On January 12, 2006, Olafson agreed he did not object to a second independent medical examination proposed by the State.(fn15) The parties also agreed to set the hearing on the claim for May 23, 2006.(fn16) The parties stipulated to the disputed issues(fn17 )and the pre-hearing officer, Kristy Donovan, issued an order directing the parties to submit records for the SIME on January 26, 2006.(fn18) On February 14, 2006, Olafson's attorney submitted questions for the SIME physician, stating in his letter to Donovan that "Mr. Olafson reserves his right to object to this SIME taking place if the SIME physician reveals a potential conflict."(fn19) On March 10, 2006, Donovan wrote to Dr. Brooks confirming the appointment to the SIME and giving instructions.(fn20) Donovan's instructions included the following paragraph concerning disclosure of potential conflicts of interest:

It is important that the SIME is truly independent, and that neither you nor anyone with whom you practice, now or in the past, have treated or examined STEPHEN V. OLAFSON. It is also important for the parties to know if you have performed any evaluations on behalf of the employer during the previous 12 months. Therefore, before acting on this SIME, please review your records to make sure there is no conflict of interest or any reason why you should not perform the SIME. If you find any association between you, your partners, and this case, or the parties of this case, or believe there is any conflict of interest, which would affect your independence, please contact me before preparing for this SIME.(fn21)

The same day, Donovan sent Olafson a notice to attend the SIME on March 27, 2006, in Bellevue, Washington.(fn22) Three days later, Jensen, Olafson's attorney, wrote to Donovan. He asked Donovan to "assure the lack of potential bias would you please confirm that Dr. Brooks has not performed prior medical evaluations paid directly or indirectly by the employer and/or its adjusters."(fn23) Jensen also asked that Donovan confirm that he "has not associated himself with the doctors retained by the Seattle Orthopedic and Fracture Clinic and/or OMAC or performed evaluations" through those organizations. "These questions," Jensen wrote, "will further ensure that Dr. Brooks has no conflict and his evaluation is truly independent. Mr. Olafson reserves his right to object to this SIME taking place if Dr. Brooks reveals a potential conflict."(fn24) On Thursday, March 16, 2006, the parties held a telephone conference with Donovan. There is no note of the conference in the record. The State later related the parties agreed to "attempt to reschedule the SIME with another physician rather than litigate Olafson's objection to Dr. Brooks."(fn25) Jensen stated the parties agreed that "Dr. Brooks should not perform the SIME" and that it should be done by Dr. Puziss.(fn26) The record does not contain a written stipulation signed by both parties. Whatever occurred, on March 16, 2006, the State's adjuster notified Olafson that the SIME was cancelled and would be rescheduled.(fn27) On Monday, March 20, 2006, Donovan notified the parties that she spoke with Dr. Brooks regarding canceling the SIME.(fn28) She wrote:

Dr. Brooks informed me that he had already spent an extensive amount of time reviewing the medical records.

I also spoke with Dr. Brooks regarding any potential conflict of interest he may have with the State of Alaska. Dr. Brooks stated that although he has performed examinations for the State of Alaska, they have not been in a quantity that he would feel it would be a conflict of interest. Dr. Brooks did name a couple of employers that he would consider a conflict of interest because of the number of examinations he has performed for them.

Please inform you[r] client that he is to attend the examination with Dr. Brooks on March 27, 2006 at 10:00 a.m. as scheduled.(fn29)

That same day, Jensen wrote to Donovan urging her to reconsider, or, if unable to reconsider, that she "refer this matter to the Alaska Workers' Compensation Board for a hearing prior to the March 27, 2006 appointment."(fn30) Evidently he also had a conversation with her, which he discussed in a letter written March 21, 2006.(fn31) The substance of this conversation was not recorded by Donovan. On March 21, 2006, Olafson filed an emergency petition to continue the SIME and obtain an order for disqualification of Dr. Brooks.(fn32) The following morning, March 22, 2006, Donovan faxed to the parties a copy of the March 21, 2006 letter she had received from Dr. Brooks:

In response to your question whether I have a conflict of interest in performing a second independent medical examination of Mr. Olafson, the answer is no. . . . [T]he state of Alaska is for me a low volume client. I could recall two recent employer's medical examinations (EME's), the most recent being almost a year ago, on June 22, 2005. A search of my computer using Windows Explorer revealed another five EME's, for a total of seven since I began coming to Alaska in 2002. Given this low volume, and because I would answer questions in the same manner whether the claim involved the state or another private employer or governmental entity, there is in my opinion no conflict of interest.(fn33)

Olafson's attorney responded by filing an affidavit of readiness to proceed on the petition the same day.(fn34) He also informally requested that the State give him a list of all cases in which Dr. Brooks has been retained as an expert in the last 12 months, those cases in which he was currently retained and those on which he is "expected to be retained."(fn35) On March 23, 2006, Rebecca Cain, the State's attorney,(fn36) wrote to Donovan.(fn37) Ms. Cain stated she had agreed to substitute another physician in order to avoid just such a situation as had now occurred.(fn38) She was concerned that the May 23, 2006 hearing on Olafson's claim would be further delayed.(fn39) She pointed out that "whether a witness is biased or not is an issue for the Board to review at hearing when it decides what weight to give the witness's evidence."(fn40) Olafson attended the Monday, March 27, 2006, SIME by Dr. Brooks. The examination resulted in a 47-page report. On Thursday, April 6, 2006, Olafson's attorney wrote again to Donovan, complaining that Dr. Brooks told Mr. Olafson that he had only skimmed the SIME medical binders and that "Dr. Brooks had not spent the over 20 hours he had told you he had spent preparing for the SIME at the time...