Employees' Retirement System v. Dorsey

³⁰⁶ GRAEFF, J. This appeal involves an application by Sylvester Dorsey, appellee, for line-of-duty disability retirement benefits with the Employees’ Retirement System of the City of Baltimore (“ERS”), appellant. A hearing examiner denied Mr. Dorsey’s application. On review, the Circuit Court for Baltimore City reversed that ruling and granted Mr. Dorsey’s application for line-of-duty disability retirement benefits. ERS appealed.

It presents two questions for our review, which we have rephrased as follows: 1. Did the lower court err in reversing the administrative decision denying Mr. Dorsey line-of-duty disability retirement due to a preexisting condition? 2. Did the lower court err in granting the application for line-of-duty disability retirement because the power to award retirement benefits is reserved for the ERS? For the reasons set forth below, we shall affirm, in part, and vacate, in part, the judgment of the circuit court.

FACTUAL AND PROCEDURAL BACKGROUND Sylvester Dorsey began working as a school police officer in August 2005. On August 31, 2007, while on-duty, Mr. Dorsey was involved in an altercation with a parent, during which the parent and a student attacked him with metal chairs. He suffered back injuries, bruises, and a deep laceration to his arm that required 38 stitches. Mr. Dorsey was on leave for several weeks, and he eventually returned to light-duty, which involved desk work, communications, and handling reports.

He never returned to full-duty. After the incident, Mr. Dorsey had weakness in his legs. In the summer of 2009, while walking down steps, his legs “gave out” on him. He fell, separating his right shoulder.

On January 17, 2009, Mr. Dorsey was terminated by his employer, the City of Baltimore, because of his injuries. On January 15, 2010, Mr. Dorsey filed an Application for Line-of-Duty Disability Retirement. ³⁰⁷ On July 12, 2010, a hearing was held regarding Mr. Dorsey’s claim. Counsel for ERS conceded that Mr. Dorsey was “incapacitated from the further performance of [h]is job and that the incapacity is permanent,” but he challenged the “degree of impairment, degree of preexisting disability” and whether the assault was the “sole cause of [the] disability.” Mr. Dorsey had a lengthy treatment record. At the time of the hearing, he had received five MRIs, eleven steroid injections, a nerve conduction study, and decompression surgery on his back.

Several doctors noted that Mr. Dorsey had preexisting asymptomatic degenerative disc disease. On November 6, 2007, Dr. Sam Matz conducted an independent medical evaluation, noting that Mr. Dorsey had degenerative disc disease in his back that was “not work-related.” He concluded that “[t]he patient’s work-related diagnosis is the strain/contusion of the lumbar spine,” and Mr. Dorsey’s preexisting condition “may have been rendered symptomatic due to [the] work accident.” Dr. Bernhard Zünkeler conducted an independent neuro-surgical evaluation. In his report, dated May 2008, he stated that, “[g]iven the appearance on MRI with disk degeneration at L5-S1, there was likely some pre-existing asymptomatic lumbar pathology, which was aggravated by the above assault, given the history.” Dr. Stanley Friedler noted preexisting degenerative disk disease at L4-L5 and L5-S1. He stated that Mr. Dorsey experienced a 35% anatomical loss to his back, 15% of which was preexisting and attributable to the degenerative disc disease and 20% due to the work incident.

He found that the incapacity was “the result of an injury arising out of and in the course of the performance of his job duties.” With respect to his arm/shoulder, Dr. Friedler opined that Mr. Dorsey had a 20% loss to his “right upper extremity,” which converted to a 12% whole person impairment. Dr. Jeffrey Gaber evaluated Mr. Dorsey and determined that he had a 60% disability to his back, and that this ³⁰⁸ disability was due solely to the injury that occurred on August 31, 2007. Dr. Gaber stated that testing indicated that Mr. Dorsey had a pinched nerve in the back, and the “right leg giving way is very commonly seen in patients who have a pinched nerve in the back (lumbar radiculopathy).” He concluded that Mr. Dorsey had 35% “impairment of the right shoulder as a result of the severe right shoulder AC joint separation, which is a result of the right leg giving way.” (Emphasis omitted). At the hearing, Mr. Dorsey testified that he felt “a real sharp constant pain down the back of the right leg into the foot.” He described having a “weakness in the leg,” causing his knee to buckle constantly.

He had difficulty walking and going up and down stairs. On one occasion, he fell down some steps after his legs “gave out,” causing separation of his right shoulder. His pain level in his lower back was “severe,” and the pain radiated to his leg. He described the pain in his back as constant and “significantly high.” Mr. Dorsey also described the injury to his right shoulder after his fall.

He experienced limitations in lifting, pushing, and pulling due to the shoulder injury, and he was in “constant discomfort.” Counsel for ERS asked Mr. Dorsey about any prior injuries or medical history regarding his neck. In December 1997, Mr. Dorsey had a fusion of C4-C5 in his neck. He stated that he had “little to no issues with [his] neck other than” the fusion. At the end of the hearing, counsel for Mr. Dorsey asserted that Mr. Dorsey’s restrictions were permanent and causally related to the work altercation.

He argued that any degenerative disc disease was not relevant to the hearing examiner’s determination because “Mr. Dorsey was asymptomatic with regardf ] to his back and his right shoulder prior to” the altercation. “The bottom line,” counsel stated, “is whether ... Mr. Dorsey has met the 50 percent point, which would enable [the hearing examiner] to give him the line-of-duty [pension] as opposed to non-line-of-duty pension.” He argued ³⁰⁹ that the percentage of injury to the back was sufficient to qualify for benefits, and that any inclusion of an injury to the arm/shoulder would put Mr. Dorsey well above the 50% threshold for line-of-duty disability retirement. Counsel for ERS argued that “[t]he statute says [the impairment] must be a direct result of the accident without any preexisting” condition, asserting that “preexisting is a medical question.” Counsel pointed to the MR1 and subsequent medical reports identifying the preexisting degenerative disc disease, asserting that any preexisting condition “under the statute rules out [Mr. Dorsey’s] entitlement to a line-of-duty disability.” The Hearing Examiner’s Ruling The hearing examiner set forth the legal requirements for a claimant to obtain disability retirement under the Baltimore City Code, art. 22, § 9(j), as follows: • [The Claimant must] file his application no later than 1 year following his last day of employment with the City and within 5 years of the date of the accident resulting in his impairment; • [The Claimant must] be permanently incapacitated from the further performance of the duties of his job classification with the City of Baltimore; • [T]he incapacity must be due to one or more of the impairments listed in the schedule set forth in Section 9(j)(5) which requires the impairment to be, “a 50% anatomical loss of the use of any 1, or a 25% or more anatomical loss of each of 2 or more,” of the body parts listed. • The body parts specified in the statute are speech, sight, neck, back, vital bodily organ, a part of the central nervous system, arm, leg, shoulder, hearing, or a mental incapacity whereby a member applies for and is granted a disability benefit under the Federal Old-Age Survivor’s and Disability Insurance Act. ³¹⁰ • The Claimant must have sustained the scheduled impairment as the direct result of a bodily injury through an accident occurring while in the actual performance of duty with the city at a definite time and place; and • [T]he impairment must be independent of all other causes and independent of any preexisting physical or medical conditions, job-related or otherwise. The hearing examiner found that Mr. Dorsey satisfied all but the last condition, that the impairment “be independent of ... any preexisting physical or medical conditions.” With respect to that condition, the hearing examiner found that Mr. Dorsey’s “pre-existing lumbar degeneration [did] contribute to the current impairment,” noting that a “hit in the back with a chair did not create” the degenerative disc disease found on the MRI.

She noted Dr. Matz’s opinion that Mr. Dorsey’s degenerative disc disease was not work-related, and Dr. Zün-keler’s opinion that Mr. Dorsey suffered from a “pre-existing asymptomatic lumbar pathology, which was aggravated by the assault.” She also cited Dr. Friedler’s apportionment of part of Mr. Dorsey’s impairment to his “pre-existing lumbar disease.” The hearing examiner found that Mr. Dorsey sustained a “40% disability to the back, with 15% of the impairment caused by the pre-existing condition and 25% due to the assault of 8/31/07.” She concluded that Mr. Dorsey suffered a “25% impairment to his back and 25% impairment to his right arm due to the assault which occurred in the line of duty on 8/31/07.” She denied Mr. Dorsey’s application, however, stating: [T]he impairment to Mr. Dorsey’s back is not independent of all other causes. The evidence is clear that the preexisting degenerative disc disease in his back contributes to Mr. Dorsey’s disability and without it Mr. Dorsey would not be as disabled as he currently is. Therefore Mr. Dorsey does not meet the statutory requirements set forth in the ³¹¹ City Code and his application for [line-of-duty] disability benefits is DENIED. Proceedings in the Circuit Court Mr. Dorsey filed a Petition for Judicial Review of the hearing examiner’s ruling in the Circuit Court for Baltimore City.

The court held a hearing on January 4, 2011. Counsel for Mr. Dorsey advised that there was no dispute regarding the facts found by the hearing examiner, but rather, the challenge was to the “conclusion based upon the facts.” Counsel argued that the City Code provision “doesn’t say [the claimant] can’t have any pre-existing, it says ... [the claimant’s] impairment has to be independent of any pre-existing” condition, and the hearing examiner’s finding that, in total, 50% of Mr. Dorsey’s impairment was due to the accident “makes that ... independent of any pre-existing [condition] he may have had.” Counsel for ERS responded that the evidence in the record supported the hearing examiner’s finding, which he characterized as “if [Mr. Dorsey] didn’t have that pre-existing [condition] he wouldn’t be disabled.” The circuit court ruled from the bench, stating that “[t]he sole question before the Court is whether the hearing examiner made an error [of] law in stating that [Mr. Dorsey] does not meet the statutory requirements for line of duty retirement benefits.” The court ruled that the hearing examiner’s findings of “25 percent impairment to his back and 25 percent impairment to his shoulder complies with the [City Code’s] requirements.” 1 It ruled that the “case should be remanded for the hearing examiner to make that conclusion.” The court’s written order, issued the same day, provided that the hearing examiner’s decision “is hereby reversed and appel ³¹² lant’s application for line of duty disability retirement benefits is granted.” ERS filed a timely notice of appeal. STANDARD OF REVIEW The Baltimore City Code provides that “[t]he determination of the hearing examiner is presumptively correct and may not be disturbed on review unless it is arbitrary, illegal, capricious, or discriminatory.” Baltimore City Code, art. 22, § 9(p)(12)(iii). This Court has explained that, although this provision “limits ‘a reviewing court’s power to reverse administrative actions and follows the general policy regarding review of administrative agency decisions,’ ” the court does have “ ‘the power to reverse an administrative decision that is arbitrary, capricious, illegal or discriminatory.’ ” Crowder v. Mayor and City Council of Baltimore, 79 Md.App. 291, 299 , 556 A.2d 726 (quoting Fire and Police Employees Ret.

Sys. of the City of Baltimore v. Powell, 78 Md.App. 563, 566 , 554 A.2d 440 (1989)), cert. denied, 317 Md. 356 , 563 A.2d 784 (1989). In Board of Trustees for the Fire & Police Employees’ Retirement System of the City of Baltimore v. Mitchell, 145 Md.App. 1, 8-9 , 800 A.2d 803 (2002), this Court, interpreting another provision of the Baltimore City Code, set forth the applicable standard of review as follows: In reviewing an administrative decision, such as the one before us, our role “is precisely the same as that of the circuit court.” Dep’t of Health & Mental Hygiene v. Shrieves, 100 Md.App. 283, 303-04 , 641 A.2d 899 (1994). We review the decision of the administrative agency itself, Ahalt v. Montgomery County, 113 Md.App. 14, 20 , 686 A.2d 683 (1996), and not the findings of fact and conclusions of law made by the circuit court. Consumer Protection Division v. Luskin’s, Inc., 120 Md.App. 1, 22 , 706 A.2d 102 (1998), rev’d in part on other grounds, 353 Md. 335 , 726 A.2d 702 (1999).

We further note that under § 34(1) of the Retirement Act, a “final determination of the hearing examiner” is “presumptively correct” and it may not be disturbed ³¹³ on appeal unless it is “arbitrary, illegal, capricious or discriminatory.” In other words, our role “is limited to determining if there is substantial evidence in the record as a whole to support the agency’s findings and conclusions, and to determine if the administrative decision is premised upon an erroneous conclusion of law.” United Parcel Serv., Inc. v. People’s Counsel, 336 Md. 569, 577 , 650 A.2d 226 (1994). “In applying the substantial evidence test, a reviewing court decides ‘whether a reasoning mind reasonably could have reached the factual conclusion the agency reached.’ ” Board of Physician Quality Assurance v. Banks, 354 Md. 59, 68 , 729 A.2d 376 (1999). Unlike a factual conclusion, however, a legal conclusion is not entitled to deference. Bozeman v. Disability Review Board of the Prince George’s County Police Pension Plan, 126 Md.App. 1, 5 , 727 A.2d 384 (1999). “When the question before the agency involves interpretation of an ordinance or statute, our review is more expansive. We are not bound by the agency’s interpretation.” Id.

DISCUSSION I. ERS contends that the circuit court erred in reversing the administrative decision because “the decision of the hearing examiner was supported by substantial evidence and was not based on prejudicial legal error.” Specifically, it asserts that, “[gjiven the evidence of other causes contributing to the disability, it was permissible for the [hearing examiner] to conclude that the element of causation had not been satisfied.” ERS argues that Mr. Dorsey’s impairment was, “as a matter of fact,” not independent of any preexisting physical condition, as required by the Baltimore City Code. Mr. Dorsey responds that the circuit court “correctly reversed the hearing examiner [because] the hearing examiner made an erroneous conclusion of law.” He asserts: The fifty percent anatomical loss from one body part or twenty five percent loss from two body parts is the thresh ³¹⁴ old for being awarded a line-of-duty disability retirement. It is the percentages contained in those thresholds that must be independent of other causes. The statute does not say that you