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- P
- 1982 Appeals Court
LUMBE RME NS MUTUAL CASUALTY COMPANY vs . WORKERS ' COMPENSATION TRUST FUND .

No. 13

- P
- 1982
Suffolk. June 2, 2015.

- September 3 , 2015.
Present: Vuono, Grainger, & Blake, JJ. Workers' Compensation Act , Reimbursement of insurer. Insurance , Insolvency of insurer. Administrative Law , Primary jurisdiction, Exhaustion of remedies, Agency's interpretation of statute.

C ivil action commenced in the Superior Court Department on May 21, 2013. The case was heard by Heidi E. Brieger , J.

W. Frederick Uehlein for the plaintiff. Douglas S. Martland , Assistant Attorney General, for the defendant.

GRAINGER, J. Lumberme ns Mutual Casualty Company in liquidation (Lumberme ns) appeals from the Superior Court judgment dismissing its claim against the Worker s' Compensation Trust Fund (t rust fund). Lumberme ns sought partial reimbursement from the fund for workers' compensation payments2

made pursuant to G. L. c. 152, §§ 37 and 65. A Superior Court judge dismissed the claim under the doctrine of primary jurisd iction. We affirm. Background
. We summarize the undisputed facts
. Lumberme ns, an Illinois Corporation, was licensed to issue workers' compensation insurance policies in Massachusetts
. Payments under these policies include d so - called "second injury" benefits awarded pursuant to G
. L . c . 152, § 37
. 1 The trust fund is authorized by that statute to provide partial reimbursement to insurers for second injury payments
. Between 2000 and 2008
Lumberme ns and the trust fund entered into agreements in six separate cases, referred to as Form 123 a greement s , 2 establishing the reimbursement percentage to be applied to "second injury" payments made b y Lumberme ns in each case. In July, 2012 , Lumberme ns was placed into rehabilitation,

a lso referred to as a "run

- off" period, whereby it could not issue new policies but continued to administer existing policies
. The trust fund, which had made reimbursement payments pursuant to the Form 123 a greements until Lumbermen s entered the

run - off period, thereafter refused further payment
. The trust

1 These may be generally described as injuries re sulting from aggravation of pre existing conditions. See Oakes's Case , 67 Mass. App. Ct. 81, 82

- 83 (2006 ), S . C . , 451 Mass. 190 (2008).

2 The nomenclature refers to the form used by the D epartment of Industrial Accidents to memorialize the § 37 reimbursement agreements between the trust fund and the insurer.3

fund asserted that Lumberme ns was no longer entitled to reimbursement once the run

- off period commenced because it was no longer a n " insurer " able to issue policies, as that term is defined in G
. L . c . 152, § 1( 7 )
. Ten months later, in May , 2013, Lumberm e ns was placed in liquidation
. Approximately one year thereafter Lumbermen s filed a complaint for enforcement of the six Form 123 a greements in Superior Court
. A Superior C ourt judge dismissed the c omplaint , finding that Lumbermen's claims were more properly heard before the reviewing board (board) of the Department of Industrial Accidents (DIA) under the primary jurisdiction doctrine
. Lumbermen s filed a timely appeal
. During the pendency of the ap peal the trust fund modified the application of its § 37 reimbursement policy to insurers in liquidation and reimbursed Lumbermen s pursuant to the Form 123

a greements . In August, 2014 , Lumbermen s filed claim s before the board for interest and attorney's f ees generated by the trust fund ' s initial refusal, and ultimate delay, in providing reimbursement
. 3

3 After the trust f und changed its § 37 reimbursement policy, it secured a stay of Lumbermen s' s appeal to assess whether Lumbermen s' s claims would be paid voluntarily. During the stay, the trust fund reimbursed Lumbermen s in full. The trust fund requested that the stay continue until the parties could resolve Lumbermen s ' s related claims for interest and attorney's fees then pending before the DIA. The stay initially was continued for that purpose but subsequently was vacated when4

Discussion
. Mootness . The trust fund asserts that payment of the amounts specified by the Form 123 agreements renders Lumbermen s' s appeal moot, as the parties' remaining dispute over interest and fees was voluntarily presented to the board by Lumbermen s itself
. We are persuaded by Lumbermen s' s rejoinder that this case presents a recognized exception to the mootness doctrine, because the jurisdictional issue , fully briefed and argued, can be rendered "capable of repetition , yet evading review" by the simple expedient of payment in a case whe neve r denial of reimbursement is challenged
. Lockhart v. Attorney
Gen . , 390 Mass. 780, 783 (19 84) , quoting from Wolf v. Commissioner of Pub. Welfare , 367 Mass. 293, 298 (1975); S ouza

v. Registry of Motor Vehicles , 462 Mass. 227, 228 n.3 ( 2012)
. We consider Lumbermen s' s submission of its remaining claims to the board simply to be recognition that f urther efforts in the Superior C ourt would have be en a futile expenditure of time and

resources . We note as well that the jurisdictional interplay between the board and the Superior C ourt has been discussed by the Supreme Judicial Court , s ee Weitzel v . Tr avelers Ins
. Cos . ,

the parties could not reach an agreement on reimbursement of interest and fees. The parties thereafter filed their briefs in this case.5

417 Mass
. 149 (1994), 4 but that the specific provision here in dispute has been addressed to date only by the Superior C ourt . 5 Primary jurisdiction
. We turn first to the language of
G. L. c. 152, § 19(1) , inserted by St. 1987, c. 691, § 9 :

" Except as otherwise provided by section seven, any payment of compensation shall be by written agreement by the parties and subject to the approval of the department
. Any other questions arising under this chapter may be so s ettled by agreement
. Said agreements shall for all purposes be enforceable in the same manner as an order under section twelve
. " The general import of this paragraph is easily discerned
. Because the purpose of the workers' compensation scheme is to protect injured workers, agreements that determine the compensation to be paid to injured workers are subject to DIA review and approval
. W e itzel , supra at 153
. However, " [a] ny other questions," which would include the reimbursement agreements und erlying the dispute in this case, may be settled by agreement without DIA approval
. Moreover, these noncompensation related agreements may be enforced under the provisions of G. L. c. 152, § 12 , which provide for submission "to the superior court departme nt of the trial court for the county in which the injury occurred or for the county of

4 We i tzel , unlike this case, concerned a compensation agreement ; tho se are made explicitly subject to DIA approval by the first sentence of G. L. c. 152, § 19(1).

5 Arrowood Indem
. Co . vs . Workers' Compensation Trust Fund , Suffolk Superior Court, No. SUCV

- 2015

- 00585 (March 24, 2015)
.6

Suffolk
. " G. L. c. 152, § 12(1) , inserted by St. 1985, c. 572, § 26
. Otherwise stated, they are enforceable just as though they had been the subject of an administrative order. 6 It is thus made explicit by statute that the Superior Court ha s jurisdiction to enforce a non compensation related agreement that was not subject to prior DIA approval
. This determination does not, however, end our inquiry
. Specifi cally, we must consider whether the judge erred in determining in this case that the doctrine of primary jurisdiction justified requiring the parties to submit this question to the board
. "The doctrine of primary jurisdiction
. . . 'is concerned with prom oting proper relationships between the courts and administrative agencies charged with particular regulatory duties
. ' " Murphy v . Administrator of the Div
. of Personnel Admin
. , 377 Mass 217, 221 (1979) , quoting from Nad e r v . Allegheny Airlines , Inc . , 426 U . S . 290, 303 (1976)
. The doctrine applies to promote "' [ u ] niformity and consistency in the regulation of business e ntrusted to a particular agency ' or

' when the issue involves technical questions of fact uniquely within the expertise and experience of an agency . '" Casey v .

6 We are unpersuaded by the trust fund's assertion, contrary to the clear language of G
. L . c . 152, § 19(1), that the DIA must convert a noncompensation related agreement into an administrative order or decision as a prerequis ite for enforcement in the Superior Court pursuant to G. L. c. 152, § 12(1).7

Massachusetts Elec
. Co . , 3 9 2 Mass
. 876, 879 (1984) , quoting from
Nader , supra at 303

- 304
. 7 Comparison with the closely related doctrine of exhaustion of administrative remedies is instructive
. While both doctrines are rooted in the principle of administrative expertise, they differ in two respects
. First, t he e xhaustion doctrine applies to the failure to obtain final resolution at the agency level of a dispute or an issue already committed to the administrative
process . Murphy , supra at 220
. By contrast, as in this case,

" primary jurisdiction situations arise in cases where a plaintiff, in the absence of pending administrative proceedings, invokes the original jurisdiction of a court to decide the merits of a controversy
. " Ibid
. The second distinction is found in the more definitive
nature of the exhaustion doctrine

- - a court is without jurisdiction to entertain an appeal from administrative proceedings that are incomplete
. This "preserve[s] the integrity of the administrat ive process while sparing the judiciary the burden of reviewing administrative proceedings in

7 We do not suggest that every noncompensation related agreement will be appropriately remanded to the board to satisfy the doctrine of primary jurisdiction. To the contrary, t here are circumstances involving "questions of law which have not been committed to agency discretion," where such agreements are properly resolved by a court in the first instance. Murphy , supra at 221. Any other result would vitiate the difference in wording between the first two sentences of § 19(1).8

a piecemeal fashion
. " I d
. at 220, citing Assuncao's Case , 372
Mass . 6 , 8

- 9 (1977)
. Where, however, a plaintiff invokes the jurisdiction of a court in the absence of administrative proceedings , it becomes necessary to make a determination (generally unnecessary to a matter already before an agency) whether the nature of the controversy is "uniquely with in the expertise and experience of [ the ] agency " in ques tion
. Casey , supra at 879, quoting from Nad e r , supra at 304
. We conclude that the dispute in this case satisfies th at test enunciated by Nader and found in Massachusetts cases such

as Murphy and Casey . The fund's determination that Lumbermen s no longer qualified as an insurer eligible for reimbursement
under the form 123 a greements was based on its interpretation of
G . L . c . 152, § 37
. T he DIA was established to apply its "expertise to the statutory scheme which
. . . it has the primary responsibility of enforcing
. " Assuncao's Case , supra at 9
. We accord " substantial deference to a reasonable interpretation of a statute by the administrative agency charged with its administration
. " Molly A
. v . Comm issioner of the Dep t . of Mental Retard ation , 69 Mass
. App . Ct . 267, 280 (2007) , quoting from Commerce Ins . Co . v . Comm issioner of Ins
. , 447
Mass . 478, 481 (2006)
. In this case the requirement of deference , hence the invocation of primary jurisdiction, is reinforced by the9

particulars of the interpretive dispute, involving reasonably plausible arguments on each side
. The trust fund relies on the words "authorized so to do" in the definition of an "insurer" as these words modify "any insurance company
. . . which has contracted with an employe r to pay [workers ' ] compensation
. "
G. L. c. 152, § 1( 7 ). The trust fund points out that, once the

run - off period commenced, Lumbermen s was not " authorized " to enter into any contracts with employers ; hence it can no longer be considered an insurer
. Lumbermen s, by contrast, relies on the past tense of the phrase "which has contracted with an employer" and argues that its previous contracts , made with then

- existing authority, serve to define it as an insurer entitled to reimbursement under § 37 on a co ntinuing basis
. I bi d
. "Given
. . . two equally plausible readings of the statutory language [ courts are required to ] defer to [ an agency's ] reasonable interpretation
. " Falmouth v . Civil Serv.
Comm n . , 447 Mass
. 814, 821 (2006)
. Conclusion
. The L egislature has directed that, unlike agreements related to the compensation paid to injured workers, noncompensation agreements m ay be enforced in the Superior C ourt without the mandatory prerequisite of DIA approval
. G. L.

c. 152, § 19(1)
. Th e legislati ve direction , however, does not relieve a court of its obligation to d etermine whether a specific non compensation issue is subject to the doctrine of10

primary jurisdiction and the underlying policies that weigh in
favor of " [ u ] niformity and consistency in t he regulation of business entrusted to a particular agency
. " Casey , 392 Mass. at 879, quoting from Nader , 426 U.S. at 303

- 304
. Th e judge determined correctly that this case falls into that category. Judgment affirmed
.