Misdiagnosis could lead to finding of mutual mistake, agreement rescission
Case name: Keller v. Liberty Northwest, Inc., No. DA 10-0125 (Mont. 12/28/10).
Ruling: The Montana Supreme Court held that the workers' compensation court imposed an incorrect standard of proof in determining whether a settlement agreement should be rescinded. The Supreme Court sent the case back to determine whether a mutual mistake occurred.
What it means: If parties to a workers' compensation settlement agreement in Montana are mutually mistaken as to a material fact concerning the nature and extent of a worker's injury, such as in the case of a misdiagnosis, then the settlement agreement may be set aside.
Summary: A county coordinator for in-home care services filled in as an in-home care provider when a coworker called in sick. Her back was injured when she attempted to break a client's fall. She sought medical treatment. The coordinator sought benefits and settled her indemnity benefits and medical benefits in two agreements. Later, a doctor diagnosed her with a long thoracic nerve injury, which caused scapular winging. The doctor concluded that the coordinator's medical records indicated that the injury was present from the date of the initial work injury, and had been ignored or missed by other doctors. The coordinator sought to rescind the settlement agreements based on mutual mistake. The workers' compensation court denied the rescission because she did not show the insurer had no knowledge of her actual injuries. The Montana Supreme Court held that the workers' compensation court imposed an incorrect standard of proof and sent the case back to determine whether there was a mutual mistake.
The court said that the nature and extent of a worker's physical condition can constitute a material fact to an agreement settling an injury claim. In this case, the coordinator's doctor's opinions made it clear that the scapular winging and nerve injury were caused by the work injury and existed at the time the parties entered the agreements. The court stated that a misdiagnosis existed.
The court also explained that a mutual mistake may exist when parties know about a theory of injury, if the theory is disregarded, forgotten, or not considered. Here, the court said it was possible that the parties entered into the agreements under a mistaken impression as to the nature and extent of the coordinator's injuries.
Read more at the WorkersComp Forum homepage.
February 7, 2011
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