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Commonwealth Court Holds That Employer Is Not Liable to Contribute to Purchase of a New One Story Home for Paraplegic Claimant

Ralph Martin Construction and Lackawanna American Insurance Co. v. Miquel Castaneda- Escobar (WCAB) ___ A.3D___, No. 341 C.D.2021 (Pa. Cmwlth filed 8/1/22).

In a case of first impression, the Court addressed Employer’s appeal from the WCAB Decision which held that the Employer was required to contribute $119,722.21 to the purchase of Claimant’s new home because that was the projected cost for modification of his previous home.  The Court reversed such holding, but affirmed the WCAB’s holding that the Employer was NOT responsible for real estate closing costs.

The case was before the Judge on Employer’s Petition to Review Medical Treatment and/or Billing asserting Claimant’s purchase of a new home was NOT a reimbursable medical expense under Section 306(f.1)(1)(ii) of the Act.  The evidence before the WCJ included settlement documents for the new home and reports from consultants regarding the home modifications needed for the original home to accommodate claimant’s needs.   A report from the Center for Independent Living of Central Pennsylvania concluded that purchase of the new home created value for the Employer because the modifications to the previous home were no longer required and Claimant would have “access to his whole home, living room, kitchen, bathroom, and outdoor space.  He can live independently…”   Nonetheless, the WCJ concluded that the Employer was NOT liable to reimburse Claimant for his purchase of the new home or the estimated costs to renovate his original home.  However, the WCJ did hold Employer liable for the closing costs on the new home and Claimant’s litigation costs since he prevailed in part.  Both parties then appealed to the WCAB.

In a well-reasoned decision, the Commonwealth Court carefully reviewed the case law and Act.  They acknowledged that this was a novel legal issue and in the past, an Employer had been required to purchase a van but the Courts had not yet required the purchase of a new home.  They then agreed with the Employer that the purchase of a new home extends the phrase “orthopedic appliances” beyond a reasonable construction.  Significantly, it was noted claimant had not testified as to why he purchased the new home instead of modifying his original home.  Moreover, the Court referenced employer’s argument noting the purchase of the new home was facilitated by Claimant’s third party settlements which totaled at least $6 million.  Second, Employer argued that the Board erred in requiring it to pay for home modifications that were never done.  Again, the Court agreed with the Employer’s position.  While this reasoning appears clear cut, the Court created some ambiguity wherein it cited our Supreme Court’s landmark case of Griffiths v Workers’ Compensation Appeal Board (Seven Stars Farm, Inc.), 943 A.2d 242 (Pa. 2008) as “key” noting the particular circumstances of the claimant must be considered in determining the precise obligation of the employer…

Thus, as always, it is key to review the particulars of your case before making a decision as to what is reasonable.    As always, the attorneys in our workers’ compensation group are available to review these issues with you.