-
USCA1 Opinion
October 28, 1992
UNITED STATES COURT OF APPEALS
FOR THE FIRST CIRCUIT
_________________________
No. 92-1337
LIBERTY MUTUAL INSURANCE COMPANY,
Petitioner,
v.
COMMERCIAL UNION INSURANCE COMPANY, ET AL.,
Respondents.
_________________________
ON PETITION FOR REVIEW OF A DECISION
OF THE BENEFITS REVIEW BOARD
_________________________
Before
Selya, Circuit Judge,
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Aldrich, Senior Circuit Judge,
____________________
and Boyle,* District Judge.
______________
_________________________
Stephen Hessert, with whom Patricia A. Lerwick and Norman,
_______________ ____________________ _______
Hanson & DeTroy were on brief, for petitioner.
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Allan M. Muir, with whom Kevin M. Gillis and Richardson &
______________ _______________ ____________
Troubh were on brief, for respondent Commercial Union Ins. Co.
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Laura J. Stomski, Attorney, with whom Marshall J. Breger,
_________________ ___________________
Solicitor of Labor, Carol A. De Deo, Associate Solicitor, and
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Janet R. Dunlop, Counsel for Longshore, were on brief, for
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federal respondent.
_________________________
_________________________
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*Chief Judge, United States District Court for the District of
Rhode Island, sitting by designation.
SELYA, Circuit Judge. This doubleheader of a case
SELYA, Circuit Judge.
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presents not one, but two, interrelated questions. Both
questions involve the nexus between occupational disease and the
Longshore and Harbor Workers' Compensation Act (LHWCA), 33 U.S.C.
901-950 (1988). First, we must decide whether, as between
successive insurance carriers, the primary obligation to provide
LHWCA benefits is triggered by a worker's disability or by his
awareness of the potential for disability. Second, we must
decide whether, as between successive insurance carriers, the
date of disablement is the date on which a worker's long-latency
disease is first diagnosed or the date on which he first
experiences a decrease in earning capacity. For the reasons that
follow, we conclude that congressional intent and administrative
convenience are best realized by a system in which, for LHWCA
purposes, liability for the effects of an occupational disease
falls upon the last responsible insurer on the date of
disability, as determined by the date of decreased earning
capacity.
I.
I.
__
Background
Background
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The underlying facts are not seriously disputed. The
claimant, Frederick Libby, worked for Bath Iron Works Corporation
(BIW) from 1941 until 1985. Throughout, he faced exposure to
asbestos. In December of 1980, Libby learned that he had
contracted asbestosis. He remained on the job, doing his regular
work, until February 13, 1985, when his physician advised him to
2
quit work. He never returned. From then on, he was totally
disabled and entitled to LHWCA benefits.
In December 1980, Commercial Union Insurance Company
(CUI) was on the risk. Soon thereafter, BIW purchased
replacement coverage from Liberty Mutual Insurance Company
(Liberty). Liberty's policy took effect on March 1, 1981. Libby
filed his claim for disability benefits pursuant to 33 U.S.C.
919(a) on April 10, 1985. Liberty was still the carrier of
record. An Administrative Law Judge (ALJ) found Libby's claim
compensable and, rejecting Liberty's effort to lay the onus of
payment at CUI's doorstep, held Liberty responsible for benefits.
The Benefits Review Board (Board) affirmed. Liberty now
petitions for judicial review.1 See 33 U.S.C. 921(c). We
___
dismiss the petition.
II.
II.
___
Analysis
Analysis
________
A.
A.
__
When Does Carrier Liability Attach?
When Does Carrier Liability Attach?
__________________________________
The threshold issue here is whether, in respect to
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1The principal respondents in this proceeding are CUI and
the Director of the Office of Workers' Compensation Programs of
the United States Department of Labor (the Director). The
Director has a foot in each camp. He supports the Board's ruling
that the date of disability, rather than the date of awareness,
controls. However, he disagrees with the Board's formulation of
how the date of disability should be determined and seeks a
modification of the Board's order in that respect. This
modification, if granted, would change the ratio decidendi and,
_____ _________
in the bargain, shift the onus of payment from Liberty to CUI.
BIW is a doubly honorific party (petitioner and respondent). We
ignore its nominal presence.
3
occupational diseases, the date of disablement or the date of
awareness of potential disablement determines which of two
responsible carriers is liable for LHWCA benefits.2 Although
the question is new to us, other courts have grappled with
offshoots of it. The seminal case is Travelers Ins. Co. v.
___________________
Cardillo, 225 F.2d 137 (2d Cir.), cert. denied, 350 U.S. 913
________ _____ ______
(1955). With regard to successive employers, Cardillo held that:
________
the employer during the last employment in
which the claimant was exposed to injurious
stimuli, prior to the date upon which the
claimant became aware of the fact that he was
suffering from an occupational disease
arising naturally out of his employment,
should be liable for the full amount of the
award.
Id. at 145. The court devised a similar test with regard to
___
successive insurance carriers:
the carrier who last insured the "liable"
employer during claimant's tenure of
employment, prior to the date claimant became
aware of the fact that he was suffering from
____________________
2Our reasoning here is limited to cases involving
occupational diseases. Although Congress has never defined the
term "occupational disease" for LHWCA purposes, we agree with the
Second Circuit that "[t]he generally accepted definition of an
occupational disease is any disease arising out of exposure to
harmful conditions of the employment, when those conditions are
present in a peculiar or increased degree by comparison with
employment generally." Gencarelle v. General Dynamics Corp., 892
__________ ______________________
F.2d 173, 176 (2d Cir. 1989) (citation and internal quotation
marks omitted). Asbestosis and other occupational diseases give
rise to special problems in assigning liability under the LHWCA
because, in contrast to episodic injuries (i.e., injuries arising
____
from isolated incidents such as a blow or a slip and fall),
occupational diseases involve continued exposure to injurious
stimuli. As a result, it is often impossible to identify a
precise date on which an injury stemming from such a disease
might realistically be said to have occurred. See Travelers Ins.
___ ______________
Co. v. Cardillo, 225 F.2d 137, 144 (2d Cir.), cert. denied, 350
___ ________ _____ ______
U.S. 913 (1955).
4
an occupational disease arising naturally out
of his employment, should be held responsible
for the discharge of the duties and
obligations of the "liable" employer.
Id. The parties agree that Cardillo is the beacon by which we
___ ________
must steer. But, they are at loggerheads over the direction that
Cardillo's principles portend for the current controversy.
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Liberty seizes upon the Cardillo court's statement of
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the "last responsible employer" rule, quoted supra p.4, and
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argues that the question before us stands decided: because
Libby's condition was diagnosed in 1980, he necessarily "became
aware" of his occupational disease at that time and, hence,
liability should fall upon CUI. We find this argument overly
simplistic. Statements in judicial opinions cannot be wrested
free of their factual moorings. Cardillo involved a case of
________
hearing loss in which the worker's awareness of the disease and
his actual disablement coincided. The Cardillo court's language
________
must, therefore, be read in this context. It cannot be applied
blindly to cases in which awareness and diminished earning
capacity occur at separate times.
Once we apply truth in labelling and treat the question
as open, rather than as a matter of stare decisis, it becomes
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evident that Liberty's reliance on Cardillo as unswerving
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authority for an all-encompassing awareness test is as shaky as a
shack built upon the shifting sands. Imposing liability based
upon the date of disability rather than the date of awareness
when the two dates do not coincide better serves the doctrinal
impetus behind Cardillo. After all, the last responsible
________
5
employer rule, and its eponymous offspring, the last responsible
insurer rule, derive from an acknowledged need to minimize the
obstacles confronting efforts at precise apportionment of
liability in the LHWCA context. As we explain below, judicial
and legislative recognition of this need, together with other
pertinent considerations, converge to support a formulation of
the last insurer rule that assigns liability based upon the date
of disability rather than the date of awareness.
1. Medical and Administrative Obstacles. Deficiencies
1. Medical and Administrative Obstacles.
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in medical knowledge create choppy seas for a system in which
awareness, as opposed to disability, determines carrier
liability. As the Cardillo court explained in connection with
________
its articulation of the rules governing the liability of
employers and their insurers:
The nature of occupational diseases and the
dearth of medical certainty with respect to .
. . [their] evolution, make it exceedingly
difficult, if not practically impossible, to
correlate the progression of the disease with
specific points in time or specific
industrial experiences.
Cardillo, 225 F.2d at 144. This same uncertainty strongly
________
suggests that the time of actual disability, rather than the time
of awareness, should govern application of the last insurer rule.
If awareness were to be more than a hollow slogan, it would have
to signify an affected worker's knowledge that a particular
disease would lead to his disablement during his career. To
reach this point, a physician would have to make not only a
diagnosis but also a fairly exact prediction as to how the
6
disease would progress in an individual case. This is
treacherous, highly speculative terrain.
In contrast, the question of when a worker becomes
disabled, while complicated, depends largely upon a medical
diagnosis of an existing condition. No crystal ball is needed
inasmuch as no prediction of future events is entailed. Because
there is, on average, much less room for legal wrangling over the
backward-looking, one-part question of when a worker became
disabled than over the forward-looking, two-part question of
when, and if, a worker will become disabled, a rule emphasizing
the former datum more closely coheres with the principles
motivating the last responsible employer rule. Or, looked at
from another angle, if uncertainty with respect to the past
progression of a disease is enough of a consideration to
influence how liability rules should be shaped, as Cardillo
________
suggests, 225 F.2d at 144-45, there is no sound reason why the
far greater uncertainty associated with predictions of the future
course, progression, and eventual severity of a disease is not
entitled to comparable weight.
Then, too, the subjective nature of Liberty's proposed
"awareness" test presents an array of epistemic difficulties. As
the Court has noted in a different context, "[t]here are special
costs to 'subjective' inquiries." Harlow v. Fitzgerald, 457 U.S.
______ __________
800, 816 (1982). Dispute and delay will almost always surround
attempts to answer the essentially subjective inquiry into when a
worker first became aware that he had contracted a particular
7
disease. In contradistinction, a last insurer rule based upon
date of disability readily lends itself to objective means of
proof, encounters fewer factual obstacles, and more smoothly
implements the LHWCA. Hinging the test on the more easily
verifiable and objective issue of disablement will, therefore,
result in a marked lessening of administrative difficulties.3
2. Congressional Intent. Another persuasive rationale
2. Congressional Intent.
____________________
for adopting this incarnation of the rule relates to
congressional intent. Of course, we are called upon here to
elucidate a judge-made rule, not a legislative provision but
the rule governing allocation of insurer liability, like all
rules of federal common law, was presumably motivated by a
concern "to fill in interstitially or otherwise effectuate the
statutory patterns enacted in the large by Congress." United
______
States v. Little Lake Misere Land Co., 412 U.S. 580, 593 (1973)
______ ____________________________
(citation and internal quotation marks omitted); see also
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____________________
3Arguing that a date-of-disability rule would be "unwieldy
and confusing," Liberty posits the following hypothetical: if
Libby had incurred medical expenses in 1980, when his asbestosis
was diagnosed, CUI would have paid them. Hence, Libby's
disablement in 1985 would have necessitated either a shifting of
responsibility for these previously incurred medical expenses
from the original to the subsequent insurer or a framework in
which one insurer pays medical benefits while another pays
disability benefits. See Petitioner's Brief at 10-11. The
___
perceived dilemma strikes us as inconsequential. Moreover, an
awareness-oriented system would have offsetting bookkeeping
costs; insurance carriers whose policies were canceled would be
required nevertheless to keep the books more open and maintain
reserves against potential claims from employees of former
insureds. In some cases, the waiting period could be many years.
Finally, any added paperwork attributable to adoption of a date-
of-disability rule cannot compare with the other administrative
inconveniences inherent in a system where awareness governs
liability.
8
Cardillo, 225 F.2d at 145. Thus, while we are not bound, in the
________
strictest sense, to follow some specifically articulated
statement of congressional intent, we look to the more generally
expressed will of Congress for guidance in fleshing out
Cardillo's judge-made rule. Cf., e.g., United States v. Fisher,
________ ___ ____ ______________ ______
6 U.S. (2 Cranch) 358, 386 (1805) (Marshall, C.J.) ("Where the
mind labors to discover the design of the legislature, it seizes
everything from which aid can be derived.").
When enacting the LHWCA, Congress rejected an
apportionment provision that would have avoided imposition of
total liability on last employers. Hearing before the Committee
on the Judiciary of the House of Representatives on H.R. 9498,
69th Congress, 1st Sess., held April 8, 15, 22, 1926 (Hearing on
H.R. 9498), Serial 16, 72, 74. The Cardillo court drew from this
________
legislative history the plausible inference "that the failure to
amend was based upon a realization of the difficulties and delays
which would inhere in the administration of the Act, were such a
provision incorporated into it." Cardillo, 225 F.2d at 145. We
________
believe that these aims and objectives are best satisfied by a
date-of-disability rule. See supra Part II(A)(1). Moreover, the
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reported discussion on the proposed amendment indicates that
Congress believed the employer at the time "disability begins"
should be liable. See, e.g., Hearing on H.R. 9498, at Serial 16,
___ ____
72, 74. Since "the treatment of carrier liability was intended
to be handled in the same manner as employer liability,"
Cardillo, 225 F.2d at 145, this bit of history argues
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9
convincingly that the date of disability should also determine
which of the "liable" employer's insurance carriers must bear the
onus of payment.4
Further evidence of congressional intent can be gleaned
from recent amendments to the LHWCA. Prior to 1984, an
employee's awareness of a relationship between "the injury or
death," on the one hand, and the employment, on the other hand,
triggered the running of the statutory period for filing claim
notices under 33 U.S.C. 912(a). Similarly, former section 13
barred a claim unless filed within a year "after the injury or
death." 33 U.S.C. 913 (a) (1982) (amended). Declaring that
"[t]he term 'injury' . . . has little applicability in the
context of a disability or death which is the result of a long-
latency occupational disease," H.R. Rep. No. 570, Part I, 98th
Cong., 2d Sess. 10, reprinted in 1984 U.S.Code Cong. & Admin.
_________ __
News 2734, 2743, a legislative committee offered amendments which
Congress enacted in 1984. In the LHWCA's revised version, the
filing period begins to run when "the employee or claimant"
learns of the tri-cornered relationship among the employment, the
disease, and the disability. See 33 U.S.C. 912(a), 913(b)(2).
___
We take this to mean that Congress identified onset of disability
____________________
4We note that, because the parties do not dispute that BIW
is the liable employer (Libby, after all, worked for only one
employer throughout the relevant period), the question of whether
explicitly to adopt or revise Cardillo's last responsible
________
employer rule is not before us. However, since the rules
governing the allocation of employer and insurer liability
operate synergistically, their formulations will perforce be
closely related.
10
not occurrence of an injury or awareness of an occupational
disease as the critical factor in filing LHWCA claims.5
Indeed, the committee report specifically stated that "[t]he
first change to the body which results from exposure to a harmful
physical agent or a toxic substance often is not disabling . . .
it is disability which should trigger the compensation claim."
H.R. Rep. No. 570, supra, 1984 U.S.C.C.A.N. at 2743. That
_____
language rather plainly implies that the compensation claim
itself, including any attendant liability, cannot arise until the
disability begins.6 See Argonaut Ins. Co. v. Patterson, 846
___ __________________ _________
F.2d 715, 720 (11th Cir. 1988).
Liberty advances two reasons why the 1984 amendments
should not affect our decision here. First, it asserts that the
amended provisions serve different functions than the provisions
to which the last insurer rule relates, ergo, the reasons
underlying their enactment shed no light on our inquiry. The
assertion constitutes a classic non sequitur. In all cases where
Congress has avoided echolalia, different statutory provisions
will serve different functional ends. But, this does not imply
that Congress's statements and actions with respect to one
____________________
5Amendments to the provision governing computation of
average weekly wages for claimants suffering from occupational
disease effected similar changes. See 33 U.S.C. 910(i).
___
Again, the legislative history buttresses the idea that Congress
enacted these changes because it saw "the onset of the disabling
condition" as an important factor. H.R. Rep. No. 570, supra,
_____
1984 U.S.C.C.A.N. at 2745.
6We refer here only to claims for compensation not to
claims for medical or other ancillary benefits.
11
portion of a statute provide no insight into the proper
interpretation of other portions of the same statute. The
reverse is often true. See, e.g., United States v. Riverside
___ ____ _____________ _________
Bayview Homes, Inc., 474 U.S. 121, 138 & n.11 (1985); United
____________________ ______
States v. Mitchell, 445 U.S. 535, 542-43 (1980); 2A J.
______ ________
Sutherland, Statutes and Statutory Construction 47.02 (1992).
____________________________________
When, as here, we are confronted with the task of divining which
of two seemingly plausible interpretations of a judicially
created rule comports more clearly with congressional intent, it
would be presumptuous to ignore explicit congressional
pronouncements addressing the issue. See, e.g., North Haven Bd.
___ ____ _______________
of Educ. v. Bell, 456 U.S. 512, 535 (1982); Cannon v. Univ. of
________ ____ ______ ________
Chicago, 441 U.S. 677, 687 n.7 (1979).
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In a second attempt to resist the onslaught of the 1984
amendments, petitioner relies on the Ninth Circuit's decision in
Port of Portland v. Director, OWCP, 932 F.2d 836 (9th Cir. 1991).
________________ ______________
This reliance is mislaid. In Port of Portland, the last
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responsible employer was attempting to foist liability on a
subsequent non-responsible employer (i.e., a business in whose
____
employ the claimant had not been exposed to any injurious
stimuli). The last responsible employer argued that, since the
claimant became disabled while in the employ of the subsequent
non-responsible employer, the latter should be held liable for
compensation. The court brushed the argument aside, observing
that it contradicted the Cardillo formulation. See id. at 841
________ ___ ___
("Cardillo remains good law.").
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12
The case at hand is vastly different. Rather than
suggesting that the 1984 amendments uprooted rules of LHWCA
liability which have been settled since Cardillo, we acknowledge
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that the amendments have no substantive effect on the question
before us. We find them to be useful, however, in divining
congressional intent with respect to the proper workings of the
statutory scheme in an area of the law that Cardillo left
________
unsettled. On that basis, the pronouncements of Congress in 1984
constitute additional support for our conclusion that legislative
intent favors a system identifying disability, and not awareness,
as the critical factor in the assignment of carrier liability
under the LHWCA.7
3. The Authorities. Our canvass of the case law
3. The Authorities.
_______________
discloses that the only other court of appeals that has directly
confronted the same question ruled that the date of disability
governs insurer liability under the LHWCA. See Argonaut, 846
___ ________
____________________
7We recognize that in certain settings the use of subsequent
legislative history may be controversial. Compare, e.g., United
_______ ____ ______
States v. Price, 361 U.S. 304, 313 (1960) (denigrating
______ _____
argumentation based on subsequent legislative history) with,
____
e.g., Red Lion Broadcasting Co. v. FCC, 395 U.S. 367, 380-81
____ __________________________ ___
(1969) (welcoming such argumentation). We believe the value of
resort to subsequent legislative history is best decided case by
case. See generally Andrus v. Shell Oil Co., 446 U.S. 657, 666
___ _________ ______ ______________
n. 8 (1979) (admonishing that subsequent legislative history
"should not be rejected out of hand as a source that a court may
consider"). In this endeavor, context is all-important. Because
our task here is to map the contours of a judicially created
rule, we look to the 1984 amendments not in an effort to
elucidate the otherwise obscure meaning of a specific statutory
provision enacted in 1926, but rather, in hopes of obtaining
guidance as to which interpretation of that rule fits more
comfortably within the overall statutory framework. Common sense
tells us that legislative history, whether contemporaneous or
subsequent, can be used for such a purpose.
13
F.2d at 719-20. Cases examining closely analogous questions lend
great credence to this result. See Port of Portland, 932 F.2d at
___ ________________
840 (date of disability governs employer liability); Cordero v.
_______
Triple A Mach. Shop, 580 F.2d 1331, 1337 (9th Cir. 1978) (same),
____________________
cert. denied, 440 U.S. 911 (1979); see also 4 A. Larson, The Law
_____ ______ ___ ____ _______
of Workmen's Compensation, 95.25(a) (1990) (stating that a
__________________________
date-of-disability rule is "frequently chosen" in the workers'
compensation area). Finally, administrative precedent is in the
same vein. See, e.g., Thorud v. Brady Hamilton Stevedore Co., 18
___ ____ ______ ____________________________
BRBS 232, 235 (1986) (holding that carrier liability attaches as
of date that employee's long-latency occupational disease
"affected his ability to earn wages"); Carver v. Ingalls
______ _______
Shipbuilding, Inc., 24 BRBS 243, 246-47 (1991) (holding that
___________________
employer liability attaches at date of disablement). In sum, the
case law, while it is fairly sparse, favors the result that we
reach today.
A point made by the Argonaut court concerning the
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letter of the Cardillo formulation bears reiteration at this
________
juncture. The Eleventh Circuit, observing that Cardillo linked
________
awareness to suffering, concluded that mere awareness of a
disease is not, in and of itself, tantamount to suffering from
that disease, especially since the term "suffering" carries "very
particular connotations which we cannot assume the Second Circuit
meant to ignore." Argonaut, 846 F.2d at 719. We agree with this
________
analysis. And, disablement meshes much more smoothly with the
concept of suffering than does awareness.
14
4. Other Considerations. We offer three final
4. Other Considerations.
_____________________
comments concerning Liberty's lament that the date-of-disability
rule is fundamentally unfair. (1) CUI contracted with BIW at a
time when Libby seemed in good health. Conversely, Liberty
contracted with BIW at a later date, when Libby's disease was a
matter of record and BIW actually knew of it. In that sense,
this case presents a choice between assigning liability to an
insurer which possessed no way of knowing of an employee's as-
yet-undiagnosed affliction or assigning liability to an insurer
that was chargeable with advance knowledge when it underwrote the
risk. As between the two, it can hardly be deemed unfair to
assign liability to the latter. Nor is this an aberration; on
average, the opportunities for advance knowledge will be at least
equal, and often greater, on the part of the date-of-disability
insurer. (2) As with the last responsible employer rule itself,
the date-of-disability version of the last insurer rule achieves
proportionality, if not in particular cases, then in the
insurance industry as a whole. See Cordero, 580 F.2d at 1336.
___ _______
It is trite, but true, that every insurer will be the last
insurer sometime. (3) For purposes of treating carriers like
Liberty fairly, it is less important that we choose any
particular formulation of the last insurer rule than that the
chosen rule be fixed and known so that its effects may enter into
actuarial calculations of premiums to be charged.
5. Summation. Recognizing, as we do, that Cardillo's
5. Summation.
_________ ________
animating principles and the spirit of the LHWCA both dictate
15
that disablement is the critical factor in assigning carrier
liability, we align ourselves on this issue with the Board, the
respondents, and the weight of authority. We hold that, as
between two insurers disputing which must pay claims under the
LHWCA, the carrier which last insured the liable employer during
the period in which the claimant was exposed to the injurious
stimuli and prior to the date the claimant became disabled by an
occupational disease arising naturally out of his employment and
exposure is responsible for discharging the duties and
obligations of the liable employer.
B.
B.
__
When Is a Worker "Disabled"?
When Is a Worker "Disabled"?
___________________________
This brings us to the second issue. The Director, who
agrees that the date of disability rather than the date of
awareness must dictate liability as between successive insurers,
asseverates that the mere diagnosis of an occupational disease
which will inevitably become disabling, e.g., asbestosis,
____
constitutes disability as a matter of law.8 This contention is
planted in the soil of our earlier opinion in Bath Iron Works
________________
Corp. v. White, 584 F.2d 569 (1st Cir. 1978). But, fertile
_____ _____
though the soil of circuit precedent may be, White cannot sustain
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this particular genus of argumentation.
1. Standard of Review. The issue presented poses a
1. Standard of Review.
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pure question of law. Therefore, our standard of review is
____________________
8In this case, the asseveration redounds to Liberty's
benefit, and Liberty has not disclaimed it. The Director,
however, is clearly its principal sponsor.
16
plenary. See, e.g., Stauble v. Warrob, Inc., ___ F.2d ___, ___
___ ____ _______ ____________
(1st Cir. 1992) [Nos. 92-1102, 1103, slip op. at 5] (adopting de
__
novo standard of review for legal questions) (collecting cases).
____
The Director attempts to vary this standard, asserting
that we should defer to his judgment and expertise. The circuits
are badly fractured in respect to the degree of deference that
ought properly to be afforded to the Director's interpretation of
the LHWCA. No fewer than four circuits cede deference to the
Director's construction of the LHWCA, at least in cases which
focus upon perceived ambiguities in the statutory text. See,
___
e.g., Force v. Director, OWCP, 938 F.2d 981, 983 (9th Cir. 1991);
____ _____ ______________
Newport News Shipbuilding & Dry Dock Co. v. Howard, 904 F.2d 206,
________________________________________ ______
208 (4th Cir. 1990); Peabody Coal Co. v. Blankenship, 773 F.2d
_________________ ___________
173, 175 (7th Cir. 1985); Boudreaux v. American Workover, Inc.,
_________ ________________________
680 F.2d 1034, 1046 & n.23 (5th Cir. 1982) (en banc), cert.
_____
denied, 459 U.S. 1170 (1983). Two other circuits have
______
consistently refused to defer. See Director, OWCP v. General
___ _______________ _______
Dynamics Corp., 900 F.2d 506, 510 (2d Cir. 1990); Director, OWCP
_______________ ______________
v. O'Keefe, 545 F.2d 337, 343 (3d Cir. 1976). The Sixth Circuit,
_______
although originally inclined to extend deference, see Saginaw
___ _______
Mining Co. v. Mazzulli, 818 F.2d 1278, 1283 (6th Cir. 1987), has
__________ ________
since decided that deference is inappropriate. See American Ship
___ _____________
Bldg. Co. v. Director, OWCP, 865 F.2d 727, 730 (6th Cir. 1989);
_________ ______________
Director, OWCP v. Detroit Harbor Terminals, Inc., 850 F.2d 283,
______________ _______________________________
287-88 (6th Cir. 1988). Our court has not addressed the subject.
We need not enter this thicket today. In the instant
17
case, the relevant uncertainty is as to the workings of a judge-
made rule. The Director insists that, "under the law of this
_______________________
Circuit, the date of disability from an occupational disease is
_______
the date of diagnosis." Director's Brief at 20 (emphasis
supplied). He concedes that, "should this Court find that its
precedent in White does not apply to this case to define
_____
disability as of diagnosis then, [sic] the Board's determination
that Liberty Mutual was liable . . . should be upheld," for,
without White, "the onset date for the claimant's disability
_____
would be the date on which the claimant first suffered a loss of
wage-earning capacity." Id. at 23.
___
Under these unusual circumstances, we see no basis for
deference. The Director's position concerns merely his
interpretation of the case law, not his interpretation of the
controlling statute. It is nonsense to suggest that a federal
court must defer to an administrative agency in determining the
meaning and applicability of the court's own precedent.
Accordingly, we examine the Director's assertion that, under
White, diagnosis constitutes disability for LHWCA purposes
_____
without any special deference but with the customary respect
afforded all litigants.
2. The Significance of White. The claimant in White
2. The Significance of White.
__________________________ _____
worked as a skilled pipecoverer until learning in 1966 that he
had contracted asbestosis. He was then transferred to an
unskilled position in the employer's machine shop. The machine
shop job ordinarily commanded a lower stipend, but the employer
18
continued to remunerate White at his former wage rate. White,
_____
584 F.2d at 572. Notwithstanding the continuation of wages, the
Board found that White sustained a diminution in earning capacity
because his disease prevented him from continuing his customary
employment and required him to accept inferior employment to earn
a livelihood. The Board reasoned that, even though White's
earnings were intact, his earning capacity was reduced since the
disease had robbed him of the ability to obtain a pipecoverer's
wages on the open market. On review, we upheld the Board's
conclusion that White was entitled to partial disability payments
covering the period of his stay in the machine shop. See id. at
___ ___
576.
Our decision in White, then, stands primarily for the
_____
proposition that reduction in earning capacity not out-of-
pocket loss is the proper test for availability of permanent
partial disability payments. See White v. Bath Iron Works Corp.,
___ _____ _____________________
812 F.2d 33, 35 & n.5 (1st Cir. 1987) (applying this proposition
in an unrelated case and citing White in support); see also
_____ ___ ____
Gardner v. Director, OWCP, 640 F.2d 1385, 1390 (1st Cir. 1981)
_______ ______________
(citing White for essentially the same proposition). This test
_____
is firmly rooted in the language of the LHWCA, a statute that
defines disablement in pertinent part as the "incapacity because
of injury to earn the wages which the employee was receiving at
the time of the injury in the same or any other employment." 33
U.S.C. 902(10).
This much is uncontroversial. In the Director's view,
19
however, White also teaches a second lesson: that, for LHWCA
_____
purposes, diminished earning capacity is a necessary concomitant
of asbestosis from and after the time the disease is diagnosed.
We disagree. To be sure, in the White case, the employee's
_____
disease was sufficiently advanced that, arguably, diagnosis and
diminished earning capacity coincided. But, it is too much of a
stretch to conclude that, because diagnosis and diminished
earning capacity may sometimes occur in tandem, the former is
indistinguishable from the latter. We do not believe that the
White court either held or intimated that disability and
_____
diagnosis are one and the same concept.
In a last-ditch effort to instill this belief, the
Director highlights an excerpt from our opinion in White:
_____
The diagnosis . . . of probable asbestosis
determined medically that White had an
occupational disease. There was a time bomb
implanted in his lungs, the power of which to
disable and destroy became stronger with
increased exposure to asbestos dust. To
argue that there must be outward physical
symptoms before a finding of permanent
partial disability flies in the face of
common sense as well as the medical evidence.
584 F.2d at 576. The Director says that this passage equates
diagnosis with disability. He is wrong. The White court was
_____
merely dispelling an argument that a finding of permanent partial
disability always requires proof of overt physical
symptomatology. Significantly, the sentence immediately
following the quoted passage states:
The Board's conclusion that White's
disease did, in fact, result in an impairment
of earning capacity and thus a compensable
20
disability is supported by substantial
medical and factual evidence and has a
reasonable legal basis.
Id. In other words, White does not instruct that, as a matter of
___ _____
law, asbestosis, once diagnosed, automatically lessens earning
capacity.9 White teaches, instead, that on particular occasions
_____
the Board may find that diagnosis and reduced earning capacity
coincide and that it may do so despite the absence of outward
physical symptoms, provided that its decision is supported by
other substantial evidence of diminished earning capacity. See,
___
e.g., B.S. Costello, Inc. v. Meagher, 867 F.2d 722, 727 (1st Cir.
____ ___________________ _______
1989) (citing White as a "substantial evidence" case); Cornell
_____ _______
Univ. v. Velez, 856 F.2d 402, 404 (1st Cir. 1988) (similar);
_____ _____
Sprague v. Director, OWCP, 688 F.2d 862, 865 (1st Cir. 1982)
_______ _______________
(similar).
Once White is placed into proper perspective, there is
_____
little more to say. Even the Director agrees that diminished
____________________
9If White stood for this proposition, the result would be an
_____
awkward mitosis of the statutory definition. For purposes of
assigning carrier liability, diagnosis would constitute
disablement (defined by the LHWCA as an "incapacity because of
injury to earn . . . wages." 33 U.S.C. 902(10)). Yet, for
purposes of collecting compensation, diagnosis would not
constitute such an incapacity (as even the Director does not
contend that, as a matter of law, all workers diagnosed as having
a disease are entitled to immediate receipt of incapacity
benefits regardless of the work they are continuing to do or the
wages they are continuing to earn). In short, were the
Director's reading of White correct, an ALJ would initially have
_____
to determine whether a diminishment in wage earning capacity of
the first species had occurred and, thereafter, would have to
answer the entirely different question of whether a diminishment
in wage earning capacity of the second type had occurred. We do
not think that White requires the statute to be construed in so
_____
convoluted a fashion.
21
earning capacity is the appropriate indicium of disablement and
that the date on which a worker suffers a diminution in earning
capacity is the date of disablement for purposes of assigning
carrier liability. The LHWCA unambiguously supports this view,
see 33 U.S.C. 902(10) (defining disability), circuit precedent
___
reaffirms the proposition, see White, 584 F.2d at 575 (stating
___ _____
that "the test [for permanent partial disability] is diminishment
of wage earning capacity"), the commentators agree, see, e.g.,
___ ____
Larson, supra, 95.25(a),10 and the case law elsewhere is in
_____
accord. See, e.g., Stevens v. Director, OWCP, 909 F.2d 1256,
___ ____ _______ ______________
1259 (9th Cir. 1990), cert. denied, 111 S. Ct. 798 (1991);
_____ ______
McBride v. Eastman Kodak Co., 844 F.2d 797, 798-99 (D.C. Cir.
_______ __________________
1988); Korineck v. General Dynamics Corp., 835 F.2d 42, 43 (2d
________ _______________________
Cir. 1987); Fleetwood v. Newport News Shipbuilding & Dry Dock
_________ ______________________________________
Co., 776 F.2d 1225, 1229 (4th Cir. 1985).
___
Here, there is no claim that Libby's disease diminished
his earning capacity prior to the time he was forced to leave
work in 1985. To the contrary, the ALJ found an absence of any
evidence that Libby suffered a diminution in earning capacity
____________________
10According to Professor Larson:
When the onset of disability is the key
factor in assessing liability under the last-
injurious-exposure rule, it does not detract
from the operation of this rule to show that
the disease . . . had become actually
apparent, or had received medical treatment .
. . so long as it had not resulted in
disability.
Larson, supra, 95.25(a) (citations omitted).
_____
22
prior to 1985. The Board affirmed this finding. Since the
finding is solidly anchored in the record, the last insurer rule
assigns liability to Liberty as the insurer at that time.
III.
III.
____
Conclusion
Conclusion
__________
In this case, all roads lead to Rome. Congressional
intent, the efficient administration of the LHWCA, circuit
precedent (properly read), and the better-reasoned authorities
converge. We hold, therefore, that the date of disability, as
determined by the date of decreased earning capacity, fixes
liability as among successive insurers for LHWCA purposes.
We need go no further. The petition to review is
dismissed and the Board's decision is affirmed. Costs shall be
taxed in favor of CUI.
So Ordered.
So Ordered.
__________
23
Document Info
Docket Number： 92-1337
Filed Date： 10/28/1992
Precedential Status： Precedential
Modified Date： 9/21/2015