Honeywell v. WCAB, 35 Cal. 4th 24 (2005)

William Wagner, a sheet metal specialist for Honeywell, claimed work-related injuries to his body and psyche due to employment. On July 20, 1998, Wagner made statements that management was prejudiced against him and hampered his promotion and transfer, that he could not “take it anymore,” and that his doctor had prescribed medication for work stress. On October 16, 1998, Wagner’s wife left a message with Honeywell’s disability coordinator that Wagner had been admitted to a psychiatric facility with a nervous breakdown and that his supervisor and others had pushed her husband over the edge with their “head games”; she requested disability claim forms. Wagner did not serve a completed workers’ compensation claim form on Honeywell until January 15, 1999. The Workers’ Compensation Judge ruled that Honeywell had sufficient information to require provision of a claim form at the latest on October 16, 1998 following the contact with Wagner’s wife. The WCAB held that under Labor Code § 5402, Honeywell was required to deny liability within 90 days of the time that it knew or should have known of the industrial injury, or a compensable injury was presumed to exist. The Court of Appeal annulled the WCAB’s decision, and the California Supreme Court affirmed. The Supreme Court held that “Section 5402’s 90- day period for denial of liability runs only from the date the employee files a claim form, not from the date the employer receives notice or knowledge of the injury or claimed injury.” The Supreme Court remanded the matter to the WCAB to determine if there was evidence to establish an estoppel precluding Honeywell from asserting the defense. Cf. Starving Students, Inc. v. Department of Industrial Relations, 125 Cal. App. 4th 1357 (2005) ($100,000 penalty upheld against employer that failed to obtain workers’ compensation insurance from an authorized insurer).