S.C. Supreme Court Addresses the “Discovery Rule”

The Supreme Court Addresses the “Discovery Rule” in Holmes v. National Service Industries, Op. No. 27059 (S.C. Sup. Ct. October 24, 2011)

Post by Kristian Cross

The South Carolina Supreme Court recently upheld a denial of a claim for workers’ compensation benefits where claimant began experiencing respiratory problems in 1992 and filed a workers’ compensation claim in 2005.  In a split decision (3-2), the Supreme Court evaluated the discovery rule which states “the statute of limitations begins to run from the date the claimant knew or should have known that, by the exercise of reasonable diligence, a cause of action exists.” Holmes v. National Service Industries, Op. No. 27059, at p. 3 (S.C. Sup. Ct. October 24, 2011) (citing Mauldin v. Dyna-Color/Jack Rabbit, 308 S.C. 18, 20, 416 S.E.2d 639, 640 (1992))

The majority and dissent differed in this case on the focus of the discovery rule. The majority focused on the discovery of the claimant’s diagnosis, whereas the dissent focused on the discovery of the causal connection between claimant’s diagnosis and her employment.  The majority and dissent also differed on whether claimant used reasonable diligence in her efforts to discover whether she had a cause of action.

It is expected the clamant will file a petition for re-hearing. Although split decisions are not uncommon, the detailed dissenting opinion at least raises the possibility the Supreme Court could change its mind. Below is a summary of the facts and the reasoning of the majority and dissent.  The petition for rehearing is due to the Court on or about November 8, 2011.  We will keep you posted as to any new developments.

FACTS

The Claimant, Carolyn Holmes, worked at a laundering facility for a linen company, National Service Industries (“National”).  Holmes described her work environment as “very hot” and “sticky” with “a lot of lint and dust in the air.”  It was undisputed the facility was poorly ventilated, and the air contained a large amount of lint, dust and chemical fumes. National did not provide protective masks to its workers.

Holmes began working for National in 1984. Her breathing and sinus problems began in 1992; however, she did not see a doctor. She used over-the-counter medication, which provided temporary relief. Holmes testified her respiratory problems were better when she was away from work.  In 1993, she was transferred to another facility where the working conditions were worse.  Holmes’ respiratory symptoms worsened, and she left National in 1994.

Holmes first sought treatment in 1995.  She was diagnosed and treated for having an allergy and sinus condition.  Due to continued problems, she sought a second opinion from Dr. Lieberman in late 1995.  Dr. Lieberman diagnosed her with sarcoidosis due to an unknown cause.  Holmes continued to receive treatment for sarcoidosis from several physicians.  In July 2005, she was seen by Dr. Spandorfer who opined Holmes’ sarcoidosis was aggravated by her employment with National from 1984 to 1994 and her exposure to airborne particles and chemical fumes.  Dr. Spandorfer also diagnosed her with occupational-onset asthma. Two months after her initial visit with Dr. Spandorfer, Holmes’ filed a workers’ compensation claim.

The single commissioner found Holmes sustained a compensable injury by accident to her lungs that was discovered on July 12, 2005.  The full Commission reversed the single commissioner, finding Holmes was aware of her working conditions and, with some diligence, she could have discovered she had a workers’ compensation claim more than two years before her filing date.  Therefore, the full Commission found Holmes’ claim was barred by the two-year statute of limitations. The South Carolina Court of Appeals affirmed the full Commission.

MAJORITY’S OPINION

The Supreme Court held whether a claimant knew or should have known a cause of action exists is a question of fact for the Commission. The majority found the full Commission had substantial evidence to support its decision.Specifically, the Court found Holmes knew or should have known her work environment was negatively affecting her health in or before 1992.  Holmes testified her respiratory symptoms decreased when she was away from work and she ultimately quit National in 1994 due to the effect her work conditions were having on her respiratory problems.

Because the majority found Holmes’ claim was time-barred, they declined to address whether the full Commission’s factual findings as to compensability and causation were the law of the case.

DISSENT’S OPINION

The dissent issued a separate opinion finding:

1. 
   
   The substantial evidence in the record demonstrated Holmes’ workers’ compensation claim was filed within two years of the date “she knew or reasonably should have known that she had sustained a compensable injury,”
   
   


2. 
   
   The unchallenged factual findings of the full Commission as to compensability and compensation rate were the law of the case; and,
   
   


3. 
   
   The decision of the original single commissioner should be reinstated. (Emphasis in original). 
   
   

The dissent reasoned the proper focus of the discovery rule should be compensability, and therefore, the Court should evaluate whether a claimant exercised reasonable diligence in discerning compensability. The dissenting justices reasoned “[t]he claimant’s knowledge of an injury, in and of itself, is not enough to commence the running of the statute of limitations. Rather, the claimant must also know or reasonably should have known that the injury is compensable.”  Holmes v. National Service Industries, Op. No. 27059, at p. 6 (S.C. Sup. Ct. October 24, 2011).

The dissent found Holmes, as a lay person, should not be held to a higher degree of medical skill than her physicians. They determined Holmes could not have known she sustained a compensable work injury prior to 2005 because none of her treating physicians related her symptoms to her employment, and she was entitled to rely upon those medical opinions.  Moreover, sarcoidosis is a “rare condition whose etiology is unknown by medical experts, that it can affect any organ in the body, and that its symptoms are highly variable from patient to patient.”   Holmes, Op. No. 27059, at p. 6.

The dissent further reasoned no finding was made as to Holmes’ asthma diagnosis, which was diagnosed in 2005. The dissent found Holmes’ sarcoidosis diagnosis had no bearing on her later-developed asthma; therefore, her claim regarding asthma was timely asserted.