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decided: December 3, 1981.


Appeal from the Order of the Workmen's Compensation Appeal Board in the case of Charles Forrest v. Babcock & Wilcox Company, No. A-78174.


George John Steffish, III, for petitioner.

Roy F. Walters, with him Leonard P. Kane, Jr., Fried, Kane, Walters & Zuschlag, for respondent, Charles Forrest.

Judges Williams, Jr., MacPhail and Palladino, sitting as a panel of three. Opinion by Judge MacPhail.

Author: Macphail

[ 63 Pa. Commw. Page 62]

Babcock & Wilcox Company (Petitioner) appeals from an order of the Workmen's Compensation Appeal Board (Board) which reversed a referee's decision and awarded compensation to Charles Forrest (Claimant) for the loss of use of one-half of his right thumb for all practical intents and purposes, pursuant to Section 306(c) of The Pennsylvania Workmen's Compensation Act (Act), Act of June 2, 1915, P.L. 736, as amended, 77 P.S. ยง 513.

Claimant sustained an injury to his right thumb on July 19, 1978 while in the course of his employment

[ 63 Pa. Commw. Page 63]

    with Petitioner and was paid compensation pursuant to a notice of compensation payable beginning on July 28, 1978. Claimant returned to work on October 23, 1978 and executed a final receipt on October 24. On May 23, 1979, Claimant filed a petition to review the notice of compensation payable, later amended to be a petition to set aside the final receipt, alleging that he had lost the use of one-half of his right thumb as a result of his work-related injury. Based on two conflicting medical reports and the referee's personal observation of the injured thumb at a hearing, the referee determined that Claimant "as a result of his July 19, 1978 injury continues to suffer an undetermined partial disability involving his right thumb which is not at this time reflected in a loss of earning power." The referee also concluded that Claimant had not suffered the loss of use of one-half of his right thumb. Accordingly, the referee set aside the final receipt but ordered that compensation be suspended effective October 23, 1978, the date Claimant returned to work. On appeal, the Board reversed the referee's order based on the Board's own observation of the injured thumb.*fn1

The issue raised by the instant appeal is whether the Pennsylvania Supreme Court's recent decision in

[ 63 Pa. Commw. Page 64]

    evidence and substitute its own findings of fact for those of the referee. . . . Cases involving loss of use do not fall within any exception to this rule.

Id. at 207, 413 A.2d at 1087 (emphasis added, citation omitted). In the instant case, the referee's decision was clearly based on competent evidence*fn3 and the Board did not find otherwise. Thus, if McGartland is applied to the instant case, the Board must be reversed for having taken additional evidence and making its own findings, when the referee's decision was supported by competent evidence.

We conclude that the Board should have followed the McGartland decision in ruling on the instant case.*fn4 "Unless vested rights are affected, a court's interpretation of a statute is considered to have been the law from its enactment date, despite contrary intervening holdings. . . . In such circumstances, the latest interpretation is applicable to a case whose appeal has not yet been decided." Kuchinic v. McCrory, 422 Pa. 620, 625, 222 A.2d 897, 900 (1966) (citation omitted, footnote omitted). It is true that a new decision may be given prospective application where it establishes a new legal principle, Schreiber v. Republic Intermodal Corp., 473 Pa. 614, 375 A.2d 1285 (1977); however, such is not the case here. In construing a statute, the court's interpretation is considered to be a declaration of the applicable law as enacted by the legislature. Myers, Jr. v. Unemployment Compensation Board of Review, 7 Pa. Commonwealth Ct. 640, 300 A.2d 917 (1973). We believe that McGartland

[ 63 Pa. Commw. Page 66]

    did not establish a new principle of law;*fn5 rather, the Supreme Court's construction of Section 423 of the Act must be considered to have been the law since the enactment of that provision. Accordingly, we must hold that the McGartland decision is applicable to the instant case and should have been followed by the Board in deciding the appeal.

Finally, we are satisfied from our review of the record that the referee's findings relative to his decision to set aside the final receipt are supported by substantial evidence and that the findings relative to the denial of specific loss benefits were not made in capricious disregard of the evidence. We also conclude that the referee has committed no errors of law.*fn6

We, accordingly, will reverse the order of the Board.

[ 63 Pa. Commw. Page 67]


And Now, this 3rd day of December, 1981, the order of the Workmen's Compensation Appeal Board, dated July 17, 1980, is reversed and the order of the referee dated October 16, 1979 is reinstated.



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