No Penalties Due To “colorable Basis” For Denial

In  ARS Construction, et al v. Worker’s Compensation Appeals Board, Wayne Davis, Respondents, the Board, in a split decision, found defendant’s delay in providing workers compensation benefits, arguing the panel QME report did not constitute substantial medical evidence, did not warrant the imposition of penalties after an ultimate AOE/COE finding following trial. The panel QME had opined that the applicant’s Valley fever was industrial.  The WCJ, after trial, issued a Findings and Award that the applicant had suffered injury on an industrial basis and awarded benefits. The WCJ also found that the defendants had unreasonably delayed the provision of medical treatment and payment of benefits and awarded a penalty on the retroactive benefits and attorney fees pursuant to LC §5814.  Defendants sought reconsideration of the AOE/COE findings and also disputed the imposition of penalties. The majority panel granted consideration, upheld the AOE/COE finding and found defendants not liable for a penalty since they had a” colorable basis for denying applicant’s claim” and were entitled to argue that the panel QME opinion was not substantial evidence noting that the panel QME was not an AME and indicated therefore on the record there was no unreasonable delay.