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McCallon v. Key Energy Services, LLC

Court of Appeals of Louisiana, Third Circuit

April 24, 2019

MICHAEL MCCALLON
v.
KEY ENERGY SERVICES, LLC, ET AL.

          APPEAL FROM THE OFFICE OF WORKERS' COMPENSATION, DISTRICT 4 PARISH OF LAFAYETTE, NO. 15-06127 ANTHONY PAUL PALERMO, WORKERS' COMPENSATION JUDGE

          Brian D. Calvit Law Office of Brian D. Calvit COUNSEL FOR PLAINTIFF-APPELLANT/APPELLEE: Michael McCallon

          Michael E. Parker Allen & Gooch A Law Corporation COUNSEL FOR DEFENDANT-APPELLANT: Key Energy Services, LLC

          Court composed of Elizabeth A. Pickett, Phyllis M. Keaty, and Jonathan W. Perry, Judges.

          ELIZABETH A. PICKETT JUDGE.

         The employee and his employer appeal the judgment rendered by the workers' compensation judge (WCJ) in favor of the employee. For the reasons discussed below, the judgment is reversed in part; amended in part; affirmed as amended; and remanded with instructions.

         FACTS

         On February 3, 2015, Michael McCallon was injured when the taxi in which he was a passenger was struck by another vehicle. Mr. McCallon, a resident of Natchez, Mississippi, was employed by Key Energy Services, LLC, as a derrick hand. He traveled to and from Williston, North Dakota, for work. Mr. McCallon had completed an eighteen-day hitch and was traveling to the Williston airport to return home when the collision occurred. To insure that he did not miss his flight, Mr. McCallon had his taxi driver arrange for another taxi to transport him the remaining distance to the airport.

         Once home in Natchez, Mr. McCallon sought treatment for back pain and radiating leg pain, which he reported began during his flight home. He was diagnosed with a herniated disc at L5-S1, and surgery to repair the injury was performed in July 2015. One of Mr. McCallon's employee benefits was short-term disability, and he filed a claim for short-term disability benefits after learning the extent of his injury. He was paid short-term disability benefits until August 4, 2015.

         In September 2015, Mr. McCallon filed a Disputed Claim for Compensation in which he alleged that he was injured while in the course and scope of his employment with Key Energy Services and, therefore, entitled to indemnity and medical benefits. Key Energy Services denied his claim and contends that Mr. McCallon was not in the course and scope of his employment when the collision occurred and that the collision was not an accident as defined by the Louisiana Workers' Compensation Act.

         In April 2016, Mr. McCallon was a passenger in a vehicle when the driver lost control of the vehicle, and it rolled over. His L-3 vertebra was fractured in the accident. In May 2016, Mr. McCallon notified Key Energy Services of the accident and his injury. In June 2016, Mr. McCallon settled his claim for personal injuries against the driver and insurer of the vehicle for the $25, 000 policy limits without obtaining Key Energy Services' consent to the settlement.

         On July 18, 2016, the parties tried their claims before the WCJ. The parties' claims presented a number of issues for resolution, including whether Mr. McCallon was injured in an accident that occurred within the course and scope of his employment when the taxi collision occurred; if so, was Key Energy Services entitled to an offset for the short-term disability benefits Mr. McCallon was paid; and whether Mr. McCallon forfeited his right to compensation benefits because he settled his personal injury claim arising from the April 2016 accident without Key Energy Services' consent.

         After taking the matter under advisement, the WCJ issued an oral ruling in which he held that Mr. McCallon was injured in the course and scope of his employment and entitled to indemnity and medical benefits. The WCJ further held that the April 2016 accident caused Mr. McCallon further injury and disability and that Mr. McCallon settled his claim for injuries arising out of that accident without obtaining Key Energy Services' consent to the settlement. Based on this finding, the WCJ held that Mr. McCallon forfeited all benefits to which he was or would be entitled. On December 16, 2016, the WCJ signed a judgment consistent with his WCJ oral ruling.

         Thereafter, Mr. McCallon filed a Motion for New Trial and/or Motion to Amend Judgment, and Key Energy Services filed a Motion for New Trial and/or Clarification of Ruling. After a hearing on both motions, the WCJ denied the motion for new trial but agreed to amend the judgment. On March 16, 2017, the WCJ again issued oral reasons for ruling in which he determined that because Mr. McCallon settled his injury claim for the April 2016 accident without Key Energy Services' consent, Mr. McCallon forfeited any benefits to which he was entitled after the April 2016 accident. The WCJ further stated that Mr. McCallon is not entitled to any benefits prior to the April 2016 accident, "until such time as a credit would be reduced by the [monies] he received in the tort suit, and/or [he] pays Key Energy Services for any benefits received."

         After this oral ruling, Key Energy Services filed a Motion to Fix Judgment, and on June 12, 2018, the WCJ issued a second judgment. In this judgment, the WCJ held that Mr. McCallon was in the course and scope of his employment with Key Energy Services at the time of the accident, that he is entitled to benefits from February 3, 2015, to April 16, 2016, and that all medical bills are to be paid in accordance with the Louisiana Workers' Compensation fee schedule. The WCJ also held that Mr. McCallon "forfeited his rights to indemnity and/or medical benefits due to his failure to inform Key Energy Services and receive their [sic] consent to settle" his claim for the April 2016 accident. Both parties appealed.

         ASSIGNMENTS OF ERROR

         Mr. McCallon assigns the following errors with the WCJ's judgment:

1. The WCJ erred in finding that Claimant's subsequent accident aggravated the employment[-]related injury and resulted in further disability.
2. The WCJ committed legal error in applying the forfeiture provisions to indemnity benefits owed prior to the date of compromise.
3. The WCJ committed legal error by not allowing Claimant to reserve his right to future compensation under the "Buy Back" provision of La.R.S. [23:]1102(B).
4. The WCJ erred in failing to award penalties and attorney fees for . . . Key [Energy Services'] failure to reasonabl[y] controvert.

         Key Energy Services assigns the following errors with the WCJ's judgment:

1. The [WCJ] erred in finding that Michael McCallon was in the course and scope of his employment with Key Energy Services . . . at the ...

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