IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Nalda Batista Cruz, :

Petitioner :

:

v. : No. 2452 C.D. 2015

: Submitted: July 1, 2016

Workers’ Compensation Appeal :

Board (Clemens Family Corporation :

and Liberty Insurance Corporation), :

Respondents :

BEFORE: HONORABLE P. KEVIN BROBSON, Judge

HONORABLE MICHAEL H. WOJCIK, Judge

HONORABLE JAMES GARDNER COLINS, Senior Judge

OPINION NOT REPORTED

MEMORANDUM OPINION

BY JUDGE BROBSON FILED: September 1, 2016 

Petitioner Nalda Batista Cruz (Claimant) petitions for review of an 

order of the Pennsylvania Workers’ Compensation Appeal Board (Board). The 

Board affirmed the decision of a Workers’ Compensation Judge (WCJ), denying 

Claimant’s penalty petition against Clemens Family Corporation (Employer). For 

the reasons set forth below, we reverse the Board’s order and remand the matter for 

further proceedings.

On April 4, 2012, Claimant sustained a lumbar injury while working 

for Employer. Employer accepted that injury pursuant to a compromise and 

release agreement (C&R), which WCJ Cathleen Sabatino approved by her decision 

circulated on June 7, 2013. The C&R provided for a payment by Employer to 

Claimant of $62,500 (less $12,500 in counsel fees) in satisfaction of Claimant’s

disability claim. With respect to medical bills, the C&R provided:
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Employer shall either pay, per the Act, medical bills 

totaling $30,000 or medical bills for treatment provided 

on or before December 1, 2013, whichever comes first. 

In no event shall Employer’s liability for medical bills 

exceed $30,000, regardless of the treatment that may be 

provided or the amounts that may be billed. In no event 

shall Employer be responsible for the payment of bills for 

the treatment provided on or after December 2, 2013, 

regardless of when, where or why such treatment might 

be provided. Claimant understands and agrees that 

Employer may pay less than $30,000 or that Employer’s 

liability for payment of medical bills may end prior to

December 1, 2013. In the event that, as of 

December 2, 2013, Employer has paid less that [sic] 

$30,000 for medical treatment, Employer shall promptly 

pay the difference to Claimant. No attorney’s fee shall 

be deducted from this payment.

(Reproduced Record (R.R.) 54a.)

On or about July 24, 2014, Claimant filed a penalty petition, alleging 

that Employer failed to pay Claimant for her medical bills in accordance with the 

C&R. Employer paid $18,350.13 for Claimant’s medical treatment from the onset 

of her injury through December 1, 2013. Employer paid Claimant an additional 

$11,649.87 (the difference between the $30,000 cap in the C&R and the total 

amount Employer paid for Claimant’s medical treatment). Claimant argues that 

Employer’s payment to Claimant under the medical treatment payment provision 

of the C&R should have been greater. She contended that the $30,000 cap applied 

only to medical bills paid from the date of the C&R up to December 1, 2013, and 

did not include bills that Employer had already paid. From the date of the C&R to 

December 1, 2013, Employer paid only $5,758.38 in medical bills. The difference 

between that amount and the $30,000 cap is approximately $24,241.62, to which 

Claimant claims she was entitled under the terms of the C&R. As Employer 

remitted to Claimant only $11,649.87, Claimant alleged that she was owed the 
3

balance of $12,591.75. Based upon that contention, Claimant asserted that 

Employer failed to comply with the medical treatment payment provision in the 

C&R and sought penalties from Employer for an alleged violation of 

Section 435(d) of the Workers’ Compensation Act (Act).1

WCJ Brian Puhala conducted a hearing on Claimant’s penalty 

petition. WCJ Puhala’s written decision included findings of fact, confirming the 

all of the payments above, with the exception of the amount Employer paid toward 

Claimant’s medical bills between the date of the C&R and December 1, 2013. 

WCJ Puhala rejected Claimant’s proffered reading of the medical treatment 

payment provision of the C&R, reaching the following relevant legal conclusions:

3. The language of the [C&R] is the exclusive source of 

the terms between the parties;

4. The clear language of the [C&R] provides [that 

Employer] would pay medical bills for Claimant’s 

work injury through December 1, 2013, subject to a 

$30,000 ceiling. There is no language in the [C&R] 

stating that this obligation began as of the date of the 

[C&R] or the approval thereof, as argued by 

Claimant;

5. Claimant’s argument that the $30,000 ceiling began 

as of 6/6/2013 is not supported by language in the 

[C&R].

(WCJ Puhala decision at 4; R.R. at 19a.)

Claimant appealed to the Board, arguing that WCJ Puhala erred by 

failing to find a latent ambiguity in the medical treatment payment provision of the 

C&R based on parole evidence—that being Claimant’s testimony as to her 

 

1 Act of June 2, 1915, P.L. 736, added by the Act of February 8, 1972, P.L. 930, as 

amended, 77 P.S. § 991(d). 
4

understanding of what the provision meant. The Board, however, concluded that 

the C&R did not contain ambiguous language or language that is susceptible to 

different constructions. (Board Op. at 4.) Based upon that view, the Board opined 

that the parol evidence rule did not apply and affirmed WCJ Puhala’s decision.

Claimant petitioned for review of the Board’s order,2raising the 

following issues: (1) whether WCJ Puhala and the Board erred as a matter of law 

in concluding that the parol evidence rule does not apply; and (2) whether WCJ 

Puhala and the Board erred in failing to address Claimant’s testimony, which, he 

contends, provides evidence that a latent ambiguity exists in the C&R.

“[A] compromise and release agreement only extinguishes liability 

which is claimed to exist under the Act where the person with the claim 

specifically agrees to relieve the liable person from that liability.” Gingerich v. 

Workers’ Comp. Appeal Bd. (U.S. Filter), 825 A.2d 788, 791 (Pa. Cmwlth.), 

appeal denied, 839 A.2d 354 (Pa. 2003). When construing contracts to determine 

the intent of the parties, courts must consider first the words of the contract, and 

when the words are clear and unambiguous, courts must rely upon the express 

language of the agreement to find intent. Crawford v. Workers’ Comp. Appeal Bd. 

(Centerville Clinics), 958 A.2d 1075, 1083 (Pa. Cmwlth. 2008). A latent 

ambiguity, however, may arise from collateral circumstances, rendering the 

meaning of what was perceived to be an unambiguous writing uncertain. 

Krizovensky v. Krizovensky, 624 A.2d 638, 643 (Pa. Super. 1993). Courts regard 

 

2 Our review is limited to considering whether an error of law occurred, whether any 

constitutional rights were violated, and whether necessary factual findings are supported by 

substantial evidence. 2 Pa. C.S. § 704.
5

the express language of a contract as sufficiently clear and, thus, binding, when the 

terms of the agreement are not susceptible to more than one interpretation. 

Amerikhol Mining, Inc. v. Mount Pleasant Twp., 727 A.2d 1179, 1182 (Pa. 

Cmwlth. 1999). If, on the other hand, the terms of a contract give rise to more than 

one reasonable interpretation, courts are free to consider extrinsic evidence, 

including parol evidence, which may resolve the ambiguity. Id.

Turning to the language of medical treatment payment provision in 

the C&R, we agree with WCJ Puhala’s and the Board’s assessment that the 

provision is not ambiguous on its face. Under the provision, Employer “shall pay” 

Claimant’s medical bills up to December 1, 2013, or up to maximum amount of 

$30,000.00, whichever first occurs. To the extent that Employer’s medical 

payments are less than $30,000.00 as of December 2, 2013, Claimant is entitled to 

a payment from Employee of the difference. This much seems clear. It was not 

until Employer actually paid Claimant “the difference” that, in Claimant’s view, a 

latent ambiguity in the provision arose as to what medical payments by Employer 

should count toward the $30,000 cap. That latent ambiguity is founded, at least in 

part, on the absence of any language in the provision that specifically addresses the 

date on which Employer’s liability for medical treatment payments under the 

provision begins for purposes of applying payments toward the $30,000.00 cap.

We, however, disagree with both WCJ Puhala and the Board that 

there is no language in the C&R that supports Claimant’s preferred interpretation 

of the medical treatment payment provision. The first sentence of the medical 

treatment payment provision of the C&R provides: “Employer shall either pay, 

per the Act, medical bills totaling $30,000 or medical bills for treatment provided 

on or before December 1, 2013, whichever comes first.” (Emphasis added.) Use 
6

of the phrase “shall . . . pay” suggests a command to act in the future, supporting 

Claimant’s proffered interpretation that only medical treatment that Employer paid 

pursuant to the C&R and thus after the parties executed the C&R should be applied 

toward the $30,000 cap.

We conclude that Claimant has proffered a reasonable, alternative 

construction of the medical treatment payment provision in the C&R to that 

Employer advances and upon which Employer based its $11,649.87 payment to 

Claimant. Accordingly, we reverse the Board’s order and remand the matter to the 

Board with the direction to remand the matter to the WCJ for additional 

proceedings, as needed, in order to determine the intent of the parties with regard 

to the medical treatment payment aspect of the C&R and to render a decision on 

Claimant’s penalty petition.

 

 P. KEVIN BROBSON, Judge
IN THE COMMONWEALTH COURT OF PENNSYLVANIA

Nalda Batista Cruz, :

Petitioner :

:

v. : No. 2452 C.D. 2015

:

Workers’ Compensation Appeal :

Board (Clemens Family Corporation :

and Liberty Insurance Corporation), :

Respondents :

O R D E R

AND NOW, this 1st day of September, 2016, the order of the 

Workers’ Compensation Appeal Board (Board) is REVERSED. The matter is 

REMANDED to the Board with the direction to remand the matter to the Workers’ 

Compensation Judge for further proceedings as required. 

Jurisdiction relinquished.

 

 P. KEVIN BROBSON, Judge