Gilliam v. Akzo Nobel Industrial Fibers, Inc.

Citations: 710 So. 2d 445; 1997 Ala. Civ. App. LEXIS 749; 1997 WL 592604Docket: 2960864

Court: Court of Civil Appeals of Alabama; September 26, 1997; Alabama; State Appellate Court

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On June 4, 1996, Akzo Nobel Industrial Fibers, Inc. initiated a lawsuit against employee Tracy L. Gilliam in the Jackson County Circuit Court, seeking a declaratory judgment on its obligations under the Alabama Workers’ Compensation Act. Akzo aimed to confirm its right to terminate Gilliam’s employment without facing liability under the retaliatory discharge statute, Ala.Code 1975, 25-5-11.1. Gilliam responded with a counterclaim for workers’ compensation benefits due to an injury sustained while working.

On August 14, 1996, Akzo moved for summary judgment, which the trial court granted on March 17, 1997. The court determined that, despite Gilliam potentially having a legitimate workers’ compensation claim, he had made false statements regarding his injury treatment. Thus, the court ruled that Akzo would not be liable for retaliatory discharge if it chose to terminate Gilliam. However, the court also clarified that Gilliam could still pursue his workers’ compensation claim.

After the trial court issued an order to finalize its judgment on March 24, 1997, Gilliam appealed on May 1, 1997. The appellate court remanded the case for compliance with procedural requirements. During the appeal, Gilliam contended that the trial court incorrectly granted Akzo relief concerning Ala.Code 1975, 25-5-8(g)(2), while acknowledging Gilliam's valid workers' compensation claim.

In reviewing the summary judgment, the same standards applied to both the trial court and the appellate court, requiring the assessment of whether genuine issues of material fact existed. The burden of proof shifted to Gilliam to present substantial evidence to counter Akzo's claims. The facts noted include Gilliam's back injury on April 16, 1996, his notification of the injury to a supervisor, and his inability to work on April 20 and 21, 1996, following worsening symptoms and advice from an Akzo employee to seek medical attention.

On April 22, 1996, Gilliam visited Dr. Grady Jones, who diagnosed him with low back pain and issued a work excuse indicating Gilliam was under his care from April 17 to April 22. After learning that the injury occurred at work, Dr. Jones recommended Gilliam seek treatment from a company doctor. Consequently, Gilliam was referred to Dr. Louis Letson, who examined him on the same day and prescribed medication and physical therapy. Gilliam, however, did not attend the recommended physical therapy sessions and falsely reported to Akzo that he had received treatment from Dr. Jones on April 17 and had attended physical therapy.

Gilliam appealed a summary judgment, claiming it was inconsistent because it acknowledged the possibility of a valid workers' compensation claim while simultaneously permitting Akzo relief under section 25-5-8(g)(2) due to an implicit finding of fraud in his workers' compensation claim. This section states that if a court finds a worker has filed a fraudulent claim, the employer is exempt from certain liabilities and may terminate the worker. The statute necessitates a clear finding of fraud by the trial court before it can be applied punitively against the employee.

The court emphasized the requirement for an explicit finding detailing the fraudulent nature of the claim, aligning with the notion that fraudulent claims also incur criminal penalties, as defined in Ala.Code 1975. The standard for proving fraud includes the requirement that the misrepresentation be material. The summary underscores that the Workers' Compensation Act should be interpreted liberally in favor of employees while adhering strictly to statutory language regarding fraudulent claims.

A material fact is defined as one that can induce a party to act. In workers' compensation claims, a material fact is essential for establishing employer liability. Misrepresentations made by an employee do not constitute a "fraudulent claim" under Ala.Code 1975, 25-5-8(g)(2) unless they pertain to facts critical to the viability of the claim. In this instance, Gilliam's misrepresentations were related to the timing and compliance of his treatment, but the essential facts—that he suffered an injury during employment—are undisputed. The trial court found Gilliam has a viable workers' compensation claim, but it did not explicitly determine that his misrepresentations were material to the claim's validity or that the claim was fraudulent. Consequently, Akzo is not entitled to judgment as a matter of law, leading to the reversal of the summary judgment and remanding for further proceedings.