Newly Enacted Va. Code § 65.2-706.2 Will Limit Defense of Res Judicata Before the Virginia Workers’ Compensation Commission and May Open Door for Piecemeal Litigation

Governor Northam signed into law SB No. 1351 on March 31, 2021. This new law will go into effect July 1, 2021 as Va. Code § 65.2-706.2. It provides as follows:

No order by the Commission awarding or denying benefits shall bar by res judicata any claim by an employee or cause a waiver, abandonment or dismissal of any claim by an employee if the order does not expressly adjudicatie such claim.

This new law is most certainly a reaction to cases such as Brock v. Voith Siemens Hydro Power Generation, 59 Va. App. 39, 716 S.E.2d 485 (2011) that had recognized the principal of res judicata in matters before the Virginia Workers’ Compensation Commission. In Brock the claimant filed a claim alleging multiple alleged body parts (shoulder, back and hip). The parties then went to hearing and only a single body part was stipulated to as injured (shoulder). After that Opinion was final the claimant filed a new Application requesting a finding that injuries to to the hip, back and legs were the result of the work accident. The Court of Appeal affirmed the finding by the Full Commission that this later Application seeking to add the hip, back and legs was barred by the doctrine of res judicata.

The Court in Brock noted that res judicata includes two distinct concepts: (1) issue preclusion and (2) claims preclusion. The former refers to barring successive litigation on facts or laws actually litigated and essential to a valid judgment while the latter refers to barring a successive matter that could have been brought at the time of the initial claim and was not. The Court of Appeals, in affirming the decision of the Full Commission, noted the strong public policy of this legal principle stating that without it the claimant could file four separate claims resulting in multiple hearings for the back, legs, head and hips that would “waste considerable time and expense on the part of the Commission” and do nothing to bring and “end to litigation and the prevention of harassment to the parties.”

What is the impact of newly enacted Va. Code § 65.2-706.2? A claimant will now be permitted to bring multiple successive claims for injured body parts so long as the claims are advanced within two years of the work accident (the applicable statute of limitation set forth in Va. Code § 65.2-601).

What, if anything, should employers and carriers now do? The only way that employers and carriers can now avoid piecemeal litigation (multiple hearings) is to ensure that any Award Order expressly adjudicates all claimed injuries.

On Award agreements I would now suggest language that reads, “this award represents a full adjudication of all alleged injuries that are a direct result of the work accident and claimant waives and abandons injuries beyond the scope of this award.” If the claimant refuses to agree to such language or the Commission does not accept it, I would suggest requesting a hearing pursuant to Va. Code § 65.2-702 to determine the full extent of injuries as a direct result of the work accident. While this code section refers to inability to reach agreement as to “compensation” the case law refers to disagreement as to “rights and responsibilities under the Act.” Leavelle v. City of Roanoke, JCN VA00000901003 (June 17, 2014) (citing Wimmer v. Asplundh Tree Expert Co., and Rose v. Asplundh Tree Expert Cos., VWC File Nos. 207-02-37 and 207-02-38 (June 12, 2002). See also Colyer Allen v. County of Henrico Schools, Record No. 0275-19-2 (December 10, 2019).

Further, at hearings I would now suggest insisting upon a stipulation that “claimant has advanced all alleged injuries that are a direct result of the work accident and claimant waives and abandons injuries beyond those asserted in the claim for benefits.” If the claimant refuses such stipulation, I would suggest requesting that the Deputy Commissioner make determination as to all injuries suffered by claimant pursuant to Va. Code § 65.2-702.

If the employer does not employ these strategies, they should be aware that the claimant may bring multiple actions in the two year period following the work accident even after an Award Order or hearing has occurred. Given the newness of this statute, we will have to see if the Commission will permit employers to insist upon an adjudication of all claimed injuries.

Should you have any questions about the issues discussed here or other legal issues, please do not hesitate to contact the lawyers at Ford Richardson.

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