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Accident Fund Insurance Co. v. Casey

Court of Appeals of Missouri, Western District, Third Division

December 19, 2017



          Before: Lisa White Hardwick, Presiding Judge, Victor C. Howard and Alok Ahuja, Judges

          Lisa White Hardwick, Judge

         In this workers compensation case, all parties appeal from the Labor and Industrial Relations Commission's decision that Accident Fund National Insurance Company ("Insurer") is liable for $521, 545.44 in workers compensation benefits to Dolores Murphy based upon the death of her husband, Robert Casey, from mesothelioma due to toxic exposure to asbestos through his employment at E.J. Cody Company, Inc. ("Employer"). In their appeals, both Insurer and Employer argue that the Commission's application of Section 287.200.4, RSMo 2016, [1] to Murphy's claim violates the Missouri Constitution's prohibition against retrospective laws.

         Because we believe that this case raises a real and substantial challenge to the validity of a state statute, it is within the Missouri Supreme Court's exclusive jurisdiction under Article V, section 3 of the Missouri Constitution. Therefore, we hereby order the case transferred to the Missouri Supreme Court.

         Factual and Procedural History

         Casey worked for approximately 30 years as a tile installer for various companies. Employer is a construction company located in Kansas City that primarily installs and repairs acoustical ceilings and tile flooring. Casey began working part-time for Employer in 1984. He started working full-time for Employer on January 1, 1987, and worked for Employer until he retired in early 1990. Throughout Casey's career as a floor tile installer, including during his employment with Employer, he was repeatedly exposed to asbestos and its hazards because he installed vinyl asbestos tile and used cutback, which is an asbestos-containing adhesive used for installing vinyl asbestos tile.

         Twenty-four years after he retired from Employer, Casey experienced a severe and uncontrollable coughing spell on October 26, 2014, which resulted in his hospitalization. He was diagnosed with mesothelioma on November 5, 2014. Casey filed a claim for workers' compensation benefits against Employer in February 2015. Casey died while the claim was pending. Murphy subsequently filed an amended claim listing herself as his dependent and his eight children as his surviving children.

         A hearing was held before an Administrative Law Judge ("ALJ"). At the start of the hearing, Murphy stipulated that she was seeking benefits solely under the "new" statute, Section 287.200.4, which became effective on January 1, 2014, and was not seeking any benefits under the "old" law applicable to occupational diseases. Section 287.200.4 provides for compensation "[f]or all claims filed on or after January 1, 2014, for occupational diseases due to toxic exposure which result in a permanent total disability or death." Section 287.200.4(3) specifically provides for compensation for mesothelioma claims and states, in pertinent part:

(3) In cases where occupational diseases due to toxic exposure are diagnosed to be mesothelioma:
(a) For employers that have elected to accept mesothelioma liability under this subsection, an additional amount of three hundred percent of the state's average weekly wage for two hundred twelve weeks shall be paid by the employer or group of employers such employer is a member of. Employers that elect to accept mesothelioma liability under this subsection may do so by either insuring their liability, by qualifying as a self-insurer, or by becoming a member of a group insurance pool. A group of employers may enter into an agreement to pool their liabilities under this subsection. If such group is joined, individual members shall not be required to qualify as individual self-insurers. Such group shall comply with section 287.223. In order for an employer to make such an election, the employer shall provide the department with notice of such an election in a manner established by the department. The provisions of this paragraph shall expire on December 31, 2038[.]

         Employer elected to accept mesothelioma liability under this statute and obtained workers compensation insurance with a mesothelioma endorsement from Insurer, effective March 16, 2014, through March 16, 2016.

         Following the hearing, the ALJ found that Employer was liable under Section 287.063.2's last exposure rule[2] and that Insurer was liable to provide coverage to Employer for Casey's mesothelioma benefits because he was diagnosed in the fall of 2014, which was within the policy period. Therefore, the ALJ awarded mesothelioma benefits under Section 287.200.4 to Murphy and to Casey's eight children.

         Employer and Insurer appealed to the Commission. The Commission affirmed and adopted the ALJ's decision, with a few modifications. Specifically, the Commission found that Section 287.063.2's last exposure rule does not apply to claims made under the new Section 287.200.4. The Commission determined that Employer was liable because there was substantial evidence that Casey's mesothelioma was an identifiable disease that had its origin in a risk connected to his employment with Employer and that his occupational exposure ...

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