State of New York

Supreme Court, Appellate Division

Third Judicial Department

Decided and Entered: June 16, 2016 521231 

________________________________

In the Matter of the Claim of

KATHY M. MARTINEZ, 

Appellant,

v

KINGSTON CITY SCHOOL DISTRICT MEMORANDUM AND ORDER

et al.,

Respondents. 

WORKERS' COMPENSATION BOARD, 

Respondent.

________________________________

Calendar Date: May 27, 2016

Before: McCarthy, J.P., Rose, Devine, Clark and Aarons, JJ.

__________

Law Offices of Richard C. Ebeling, Putnam Valley (Richard

C. Ebeling of counsel), for appellant.

Ryan Roach & Ryan LLP, Kingston (Jill M. Johnson of

counsel), for Kingston City School District and another,

respondents.

__________

Rose, J.

Appeal from a decision of the Workers' Compensation Board

filed August 22, 2014, which ruled that claimant violated

Workers' Compensation Law § 114-a and disqualified her from

receiving further workers' compensation benefits. 

As a result of a January 2005 work-related accident,

claimant sustained compensable injuries to her left ankle and

lower back and was awarded wage replacement benefits. Following
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claimant's October 2009 arrest for insurance fraud, and based

upon responses provided by claimant on a workers' compensation

questionnaire denying participation in any work or volunteer

activity since her 2005 accident and an investigation and a May

23, 2008 video surveillance of claimant, the employer sought to

suspend her wage replacement benefits. A hearing ensued, after

which a Workers' Compensation Law Judge (hereinafter the WCLJ)

found that claimant knowingly misrepresented her volunteer

activity with CitiVision, a youth-based camp formerly directed by

her husband, in order to obtain workers' compensation benefits in

violation of Workers' Compensation Law § 114-a (1). The WCLJ,

having imposed a mandatory and discretionary penalty, rescinded

benefits awarded to claimant from May 23, 2008 to November 9,

2009 and disqualified her from receiving future wage replacement

benefits. Upon administrative review, the Workers' Compensation

Board adopted and affirmed the decision of the WCLJ, and claimant

now appeals.

Workers' Compensation Law § 114-a (1) provides that a

claimant will be disqualified from receiving compensation

attributable to a false statement or representation of a material

fact made for the purpose of obtaining wage replacement benefits. 

Any compensation already paid to a claimant which is "directly

attributable" to a claimant's misrepresentations must be

rescinded by the Board (Workers' Compensation Law § 114-a [1];

see Matter of Losurdo v Asbestos Free, 1 NY3d 258, 265 [2003];

Matter of Church v Arrow Elec., Inc., 69 AD3d 983, 984 [2010]). 

The Board also has the discretionary authority to disqualify the

claimant from receiving any future wage replacement benefits

regardless of "whether or not the claimant is subject to the

mandatory penalty" (Matter of Losurdo v Asbestos Free, 1 NY3d at

265-266), even if the claimant has suffered a compensable injury

(see id. at 266; Matter of Lopresti v Washington Mills, 23 AD3d

725, 726, [2005]).1 In determining whether a claimant violated

1 Alternatively, the Board may, in its discretion, subject

a claimant to a monetary penalty not to exceed the amount of

benefits received that is directly attributable to the false

statement or representation (compare Workers' Compensation Law

§ 114-a [1], and Matter of Losurdo v Asbestos Free, 1 NY3d 258,
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Workers' Compensation Law § 114-a, we remain mindful that "'[t]he

Board is the sole arbiter of witness credibility and its

determination that claimant violated Workers' Compensation Law

§ 114-a will be upheld if supported by substantial evidence'"

(Matter of Petrillo v Comp USA, 131 AD3d 1282, 1283 [2015],

quoting Matter of Hammes v Sunrise Psychiatric Clinic, Inc., 66

AD3d 1252, 1252 [2009]; accord Matter of Tangorre v Tech Home

Elec., LLC, 124 AD3d 1183, 1184 [2015]). 

Here, claimant testified that she has not worked or

volunteered since her 2005 accident and that she has not

undertaken any duties relative to the operation of the CitiVision

camp. She also acknowledged that she received questionnaires

from the self-insured employer, including an August 8, 2008

questionnaire in which she denied having done any work or

volunteer activity since her 2005 accident. Contrary to her

testimony and questionnaire responses, an investigation and video

surveillance conducted by a field investigator demonstrated that

claimant was listed as a contact person for the CitiVision camp

and that, on May 23, 2008 when the video surveillance was

conducted, she was available in the camp's main office and

answered questions about the camp's activities. Furthermore,

claimant acknowledged that she might have assisted with answering

the camp's telephone and that she was authorized to sign checks

on behalf of CitiVision. In our view, the Board's determination

that claimant violated Workers' Compensation Law § 114-a by

making false representations regarding material facts for the

purpose of obtaining wage replacement benefits is supported by

substantial evidence and will not be disturbed (see Matter of

Petrillo v Comp USA, 131 AD3d at 1283; Matter of Woods v New York

State Thruway Auth., 27 AD3d 933, 933 [2006], lv denied 7 NY3d

716 [2006]). 

Turning to the penalties imposed as a result of claimant's

misrepresentation of a material fact, in our view the record

evidence does not support the Board's determination that the

mandatory penalty of forfeiture of benefits received applies from

265 [2003], with Matter of Church v Arrow Elec., Inc., 69 AD3d

983, 984 [2010]). 
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May 23, 2008 — the date of the video surveillance of claimant —

to November 9, 2009, the date that claimant's wage replacement

benefits were suspended. Specifically, we do not agree with the

Board that the May 23, 2008 video surveillance of claimant

reveals a false statement or misrepresentation made by claimant

that is directly attributable to, and made for the purpose of

obtaining, wage replacement benefits (see Matter of Losurdo v

Asbestos Free, 1 NY3d at 265-266; Matter of Church v Arrow Elec.,

Inc., 69 AD3d at 985). Rather, the record before us establishes

that the first instance that claimant affirmatively made a false

statement and misrepresentation for the purpose of enabling her

continued receipt of wage replacement benefits is the August 8,

2008 questionnaire in which she denied any involvement in work or

volunteer activity. 

As for the additional discretionary sanction of

disqualifying claimant from receiving future wage replacement

benefits, the Board failed to provide "the rationale for the

imposition of a discretionary penalty" (Matter of McCormack v

Eastport Manor Constr., 19 AD3d 826, 829 [2005]), and, therefore,

absent any explanation for its decision to impose this penalty,

the Board failed to satisfy its obligation to "provide some basis

for appellate review" (Matter of Losurdo v Asbestos Free, 1 NY3d

at 267; cf. Matter of Robbins v Mesivtha Tifereth Jerusalem, 60

AD3d 1166, 1168 [2009]; Matter of Jordan v Saratoga County Pub.

Health Nurses, 45 AD3d 1074, 1075 [2007]; Matter of Lopresti v

Washington Mills, 23 AD3d at 726). Upon remittal, if the Board

determines, as a matter of discretion, that disqualification is

warranted, it should "provide some explanation for its

determination in this regard" (Matter of Losurdo v Asbestos Free,

1 NY3d at 267; see Matter of Bowes v Gulinello's Town & Country,

3 AD3d 805, 806 [2004]). 

McCarthy, J.P., Devine, Clark and Aarons, JJ., concur.
-5- 521231 

ORDERED that the decision is modified, without costs, by

reversing so much thereof as directed recision of any benefits

received by claimant prior to August 8, 2008 and disqualified

claimant from receiving all future wage replacement benefits;

benefits are rescinded from August 8, 2008 to November 9, 2009

and matter remitted to the Workers' Compensation Board for

further proceedings not inconsistent with this Court's decision;

and, as so modified, affirmed.

ENTER:

Robert D. Mayberger

Clerk of the Court