State of New York

Supreme Court, Appellate Division

Third Judicial Department

Decided and Entered: October 8, 2015 520633 

________________________________

In the Matter of the Claim of

GLEN GUADAGNO,

Respondent,

v

RIC STEEL ERECTORS et al.,

Appellants,

and

MEMORANDUM AND ORDER

SPECIAL FUND FOR REOPENED

 CASES,

Respondent.

WORKERS' COMPENSATION BOARD,

Respondent.

________________________________

Calendar Date: September 16, 2015

Before: Lahtinen, J.P., Egan Jr., Devine and Clark, JJ.

__________

William O'Brien, State Insurance Fund, Endicott (Scott B.

Anglehart of counsel), for appellants.

Steven M. Licht, Special Funds Conservation Committee,

Albany (Jill B. Singer of counsel), for Special Fund for Reopened

Cases, respondent.

__________

Devine, J.

Appeal from a decision of the Workers' Compensation Board,

filed April 17, 2014, which ruled, among other things, that the

State Insurance Fund was not entitled to the payment of interest

from the Special Fund for Reopened Cases on certain payments for
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claimant's medical expenses pursuant to Workers' Compensation Law

§ 25 (1) (f).

Claimant suffered a work-related injury in 1981 and

established a claim for workers' compensation benefits. The

State Insurance Fund (hereinafter SIF), the employer's workers'

compensation carrier, made the last payment of compensation in

1989 and the case was closed. In 2001, SIF sought to transfer

liability for the claim to the Special Fund for Reopened Cases

pursuant to Workers' Compensation Law § 25-a. In 2007, the

Workers' Compensation Board found that Workers' Compensation Law

§ 25-a was applicable and transferred liability to the Special

Fund as of October 23, 1999. The parties thereafter agreed that

the Special Fund would pay a total of $680,581.92 in full

satisfaction of SIF's reimbursement request, and the Special Fund

remitted the final payment on October 22, 2010. 

In December 2010, SIF requested that, pursuant to Workers'

Compensation Law § 25 (1) (f), the Special Fund pay SIF interest

in the amount of $315,651.14 on the reimbursed medical expenses. 

Following hearings, a Workers' Compensation Law Judge determined

that, among other things, SIF was entitled to interest pursuant

to Workers' Compensation Law § 25 (1) (f), but limited the amount

to interest on a $4,069.32 award made in 2005 for medical and

transportation expenses. Upon appeal, the Board disagreed and

held that Workers' Compensation Law § 25 (1) (f) does not apply

to the transfer of claims under Workers' Compensation Law § 25-a. 

Therefore, the Board determined that SIF is not entitled to the

interest provided for in Workers' Compensation Law § 25 (1) (f),

including the interest on the 2005 award for $4,069.32, and the

Board retroactively modified prior decisions on this claim to

remove all references to the statute. The employer and SIF now

appeal.

We affirm. The issue presented to this Court is whether

Workers' Compensation Law § 25 (1) (f) applies to medical

expenses paid by an employer or its workers' compensation carrier

during a time that the Special Fund is ultimately determined to

be liable for the claim, but prior to the transfer of liability

to the Special Fund by the Board pursuant to Workers'

Compensation Law § 25-a. "Inasmuch as the issue before us is one

of statutory interpretation for the courts, the Board's decision
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is not entitled to deference" (Matter of Krausa v Totales

Debevoise Corp., 84 AD3d 1545, 1546 [2011] [citation omitted];

see Matter of LaCroix v Syracuse Exec. Air Serv., Inc., 8 NY3d

348, 352-353 [2007]). Nevertheless, we agree with the Board's

interpretation that SIF is not entitled to interest pursuant to

Workers' Compensation Law § 25 (1) (f). 

Workers' Compensation Law § 25 (1) (f) states: "Whenever

compensation is withheld solely because a controversy exists on

the question of liability as between insurance carriers, surety

companies, the special disability fund, the [Special Fund], or an

employer, the [B]oard may direct that any carrier, surety

company, the special disability fund, [or] the [Special Fund]

shall immediately pay compensation and bills for medical care

. . . pending determination of such issue. Any such payment or

payments shall not be deemed an admission against interest by the

carrier, surety company, special disability fund or the [Special

Fund]. After final determination, the parties shall make the

necessary and proper reimbursement including the payment of

simple interest at the rate established by [CPLR 5004] in

conformity with such determination." Here, SIF, as the

employer's workers' compensation carrier, was obligated to pay

claimant's medical expenses until liability for the claim was

transferred to the Special Fund (see Workers' Compensation Law

§ 13; Matter of Martin v New York Tel., 46 AD3d 1136, 1137

[2007]). The Board, as such, did not direct SIF to pay

claimant's medical expenses pending the transfer of liability

pursuant to Workers' Compensation § 25-a, the sole criterion of

which was whether the application to reopen was "made more than

seven years from the date of injury and more than three years

after the last payment of compensation" (Matter of Thurston v

Consolidated Edison Co. of N.Y., Inc., 115 AD3d 1143, 1144 [2014]

[internal quotation marks and citations omitted]; see Matter of

Khomitch v Crotched Mtn. Community, 120 AD3d 1459, 1461 [2014]). 

In our view, the language of Workers' Compensation Law § 25 (1)

(f) reflects that it was intended for controversies where the

Board directs an entity to make certain payments on a claim

pending the resolution of a dispute regarding liability, which

could otherwise be deemed an admission of liability. That

situation does not exist here. Accordingly, the interest

provision included in Workers' Compensation Law § 25 (1) (f) is
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inapplicable to transfers of liability under Workers'

Compensation Law § 25-a and the Board's decision is affirmed.

We have examined and are unpersuaded by the remaining

argument advanced by the employer and SIF.

Lahtinen, J.P., Egan Jr. and Clark, JJ., concur.

ORDERED that the decision is affirmed, without costs.

ENTER:

Robert D. Mayberger

Clerk of the Court