Source: http://wcc.state.ct.us/crb/2001/4104crb.htm
Timestamp: 2014-03-12 17:53:48
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Schiano v. Bliss Exterminating Co.
CASE NO. 4104 CRB-4-99-8
BLISS EXTERMINATING CO.
This Petition for Review from the August 6, 1999 Finding and Memorandum of Decision of the Commissioner acting for the Fourth District was heard April 14, 2000 before a Compensation Review Board panel consisting of the Commission Chairman John A. Mastropietro and Commissioners Robin L. Wilson and Amado J. Vargas.
JOHN A. MASTROPIETRO, CHAIRMAN. The claimant has petitioned for review from an August 6, 1999 Finding and Memorandum of Decision by the Commissioner acting for the Fourth District. He sets forth a twofold argument on appeal: that the trier lacked jurisdiction to decide the instant matter due to the parties’ settlement of the underlying issues, and, alternatively, that the trier erred in his legal analysis by underestimating the breadth of the penalty provisions in § 31-303 C.G.S. Although we conclude that the trial commissioner had jurisdiction to render a decision, we also find error in his interpretation of the law.
At the outset, we observe that these parties have appeared before this board on several prior occasions in attempting to resolve various legal disputes stemming from the claimant’s February 25, 1986 compensable injury. This distinguished history of appellate review consists of Schiano v. Bliss Exterminating Co., 57 Conn. App. 406 (2000), affirming both Schiano, 3436 CRB-4-96-10 (April 8, 1998), and Schiano, 13 Conn. Workers’ Comp. Rev. Op. 45, 1852 CRB-4-93-9, 1341 CRD-4-91-11 (Dec. 7, 1994), as well as Schiano, 16 Conn. Workers’ Comp. Rev. Op. 189, 3315 CRB-4-96-4 (May 16, 1997) (dismissal order). The subject matter of those opinions is largely irrelevant to the events that make up the factual backdrop of the issue before us today.
As the trier observed in his August 6, 1999 decision, the claimant was awarded $53,859.29 in temporary total disability benefits (including interest for nonpayment through September 30, 1995), $25,000 in attorney’s fees, and additional interest on the entire award pursuant to an April 8, 1996 Supplemental Finding and Award. The Second Injury Fund appealed that decision, and the claimant followed with his own petition for review. On May 16, 1997, the Fund’s appeal was dismissed by this board for failure to prosecute with due diligence. This board criticized the Fund’s conduct in handling the appeal, and costs were awarded to the claimant, with the matter remanded to the trier for calculation of those costs under § 31-327(b). Schiano, supra, 191-92.
The claimant then withdrew his cross-appeal on July 22, 1997. Subsequently, the Fund paid the amounts prescribed in the award. The trial commissioner determined that the disability payments and attorney’s fees were paid 37 days following the withdrawal, while the $7,490.39 award of additional interest for late payment took 71 days to reach the claimant. According to § 31-303, “Payments due under an award shall commence on or before the tenth day from the date of such award. . . . Any employer who fails to pay within the prescribed time limitations of this section shall pay a penalty for each late payment, in the amount of twenty per cent of such payment, in addition to any other interest or penalty imposed pursuant to the provisions of this chapter.” The claimant alertly sought late payment penalties under this provision, whose materiality the Fund disputed on the ground that it is not an employer under the Workers’ Compensation Act.
The Fund does not contradict the claimant’s assertion that, throughout the time period surrounding the January 19, 1999 formal hearing, both parties were in agreement that our Supreme Court’s then-anticipated decision in Casey v. Northeast Utilities would resolve the § 31-303 issue. Nevertheless, there is no indication in the record that either side sought cancellation of the formal hearing before this Commission on the instant matter. The Court released its decision in Casey on June 29, 1999, holding that the penalty provision of § 31-303 was applicable to late payments made by the Fund. “From an injured employee’s point of view, delay in making payments by the fund is as harmful as is delay by an employer. Casey, 249 Conn. 365, 383 (1999). The claimant’s counsel reports that he contacted the Fund upon receipt of this ruling, “and on approximately July 22, 1999 the Fund made payment equal to twenty percent of the aforementioned award for temporary total disability, attorney’s fees and interest.” Brief, 4.
The trial commissioner, meanwhile, issued his own ruling on August 6, 1999, in which he reasoned that the delay in payment of attorney’s fees was not subject to the § 31-303 penalty under Casey. Thus, he ordered that the 20% penalty be paid on the principal amount of $53,859.29 only. The claimant filed a motion for reargument and a motion to vacate that judgment with the trier on August 13, 1999, citing the parties’ settlement of these issues and alleging that this commission was informed of said settlement prior to the issuance of the commissioner’s decision. The trier summarily denied both of these motions, leaving this board to address the claimant’s appeal.
At oral argument, the claimant primarily focused on one topic: whether the trier retained subject matter jurisdiction to enter his August 6, 1999 order. We address that issue first, as the existence of subject matter jurisdiction is a prerequisite to the valid assertion of authority by any administrative agency or judicial body. American Premier Underwriters, Inc. v. National Railroad Passenger Corp., 47 Conn. App. 384, 390 (1997). The jurisdiction of a workers’ compensation commissioner is strictly premised on powers granted by the Workers’ Compensation Act. The main source of such authority is § 31-278, which invests a commissioner with “all powers necessary to enable him to perform the duties imposed on him by the provisions of [Chapter 568],” and empowers him to “hear all claims and questions arising under this chapter.” Our Supreme Court has described the core of a commissioner’s jurisdiction as being “limited to adjudicating claims arising under the act, that is, claims by an injured employee seeking compensation from his employer for injuries arising out of and in the course of employment.” Stickney v. Sunlight Construction, Inc., 248 Conn. 754, 762 (1999).
Though ancillary to an award of benefits, matters involving § 31-303 penalties still arise directly under the Act, for they concern the untimely payment of compensation to a claimant. Therefore, when a party requests that a hearing be held concerning the applicability of § 31-303, the trial commissioner has the power to assume jurisdiction over the resolution of that issue and to schedule the necessary proceedings. Public policy favors the voluntary settlement of workers’ compensation cases, of course, and the commissioner generally attempts to aid the parties in reaching a fair agreement as swiftly as possible through the informal hearing process. However, experience teaches us that an accord cannot always be reached. Eventually, after a formal hearing has been conducted, arguments have been made, and a record has been created, the commissioner will render a decision based on the evidence before him. This ruling will be binding on the parties who brought their dispute before this agency in order to see it resolved.
In this case, the parties could not settle their dispute, so a formal hearing was held. Both parties allegedly represented to the trial commissioner that Casey, supra, would determine whether the Fund could be subjected to penalties under § 31-303.1 Several months later, when Casey was finally released by our Supreme Court, the commissioner evidently obtained a copy of the decision and began to prepare his ruling in this case. Although the claimant’s counsel maintains that he placed a telephone call to the trial commissioner informing him that he had reached an agreement with the Fund, there is no physical documentation of such an occurrence in the record. What the file does contain is a letter addressed to the trial commissioner dated August 5, 1999 (of which we take administrative notice), stating that the Second Injury Fund had made payments totaling $17,269.23 as requested by the claimant, which had rendered the issues “to be addressed in the formal hearing before [the commissioner]” moot. That letter was stamped “received” by the Fourth District office on August 6, 1999—the same day the trier’s decision was issued—and then by the Seventh District office (where the trial commissioner was currently sitting) on August 10, 1999.
Under the Workers’ Compensation Act, an agreement between parties concerning the payment of disability benefits, medical expenses, or attorney’s fees is subject to the approval of the trial commissioner. See Muldoon v. Homestead Insulation Co., 231 Conn. 469, 480 (1994) (no stipulation is binding until it has been approved by the trial commissioner); Dowling Considine v. Slotnik, 3468 CRB-4-96-11 (May 6, 1998) (approval of stipulation is more than a ministerial act); Ayala v. Konover Residential Corp., 14 Conn. Workers’ Comp. Rev. Op. 87, 89, 1931 CRB-2-93-12 (May 12, 1995) (claimant need not dispute attorney’s fee in order for trier to exercise supervisory power under § 31-327(b)). Once the parties have invoked the jurisdiction of this agency, any resolution of pending issues involving the payment of compensation must be ratified by the commissioner in order for it to constitute a binding judgment. A settlement agreement is not self-actuating, and does not by its mere existence implicate the trier’s subject matter jurisdiction. See Williams v. Shawmut Mortgage Co., 49 Conn. App. 114, 119-20 (1998). Instead, the parties must present their contractual compromise to the judicial authority, so that he or she may review the agreement and consider entering judgment accordingly. Muldoon, supra; see also, Central Conn. Teachers’ Federal Credit Union v. Grant, 27 Conn. App. 435 (1992) (stipulated judgment is the result of a contract acknowledged in open court). This requires that the parties successfully communicate their intent to settle the case before the commissioner releases his decision.
Here, there is no demonstrable proof that the trial commissioner knew or should have known of the parties’ putative settlement before he issued his decision. The letter from claimant’s counsel arrived in the Fourth District office in Bridgeport sometime on Friday, August 6, 1999, the same day that the trier’s decision was mailed from the Seventh District office in Stamford. We must presume that, by denying the claimant’s motion to vacate and his motion for reargument, the commissioner was acknowledging that he had not been informed of the Fund’s payment of the requested penalties prior to the completion of his written ruling. Thus, he was not in a position to take into account the parties’ agreement regarding § 31-303 penalties during the preparation of his decision. We accordingly hold that the trier had jurisdiction to issue his August 6, 1999 Finding and Memorandum of Decision.
The claimant also argues that the trier erred by holding that the penalty provision of § 31-303 does not apply to an award of attorney’s fees to the claimant. In his view, the statute makes no distinction between sums due to the claimant for disability benefits and other types of payments, including awards of attorney’s fees, in assessing a twenty- percent penalty to all late payments made under an award. The statute provides,
Payments agreed to under a voluntary agreement shall commence on or before the tenth day from the date of agreement. Payments due under an award shall commence on or before the tenth day from the date of such award. Payments due from the Second Injury Fund shall be payable on or before the tenth business day after receipt of a fully executed agreement. Any employer who fails to pay within the prescribed time limitations of this section shall pay a penalty for each late payment, in the amount of twenty per cent of such payment, in addition to any other interest or penalty imposed pursuant to the provisions of this chapter.
(Emphasis added.) In Casey, supra, our Supreme Court held that the Fund’s failure to make timely payment of a lump sum award for temporary total disability benefits warranted the twenty percent penalty. “Because the fund essentially stands in the shoes of the employer for purposes of payment of compensation, we conclude that the penalty provision of § 31-303 is equally applicable to the fund.” The Court did not have specific occasion to define the breadth of the term “award,” i.e., whether it may include allocations of attorney’s fees or interest. Upon our own consideration of the matter, we find the claimant’s analysis of the law to be accurate.
Within the Workers’ Compensation Act, an “award” is not restricted to compensation that is directly and ultimately payable to the claimant as a wage loss benefit. The term “award” also refers to orders that require a respondent to assume liability for costs incurred by the claimant as a result of his compensable injury and the subsequent maintenance of his claim. Therefore, it would be accurate to describe a commissioner as “awarding” interest and attorney’s fees due to unreasonable contest or undue delay pursuant to § 31-300 (“the commissioner may include in his award interest . . . and a reasonable attorney’s fee”). See Balkus v. Terry Steam Turbine Co., 167 Conn. 170, 172 n.1 (1974); see also § 31-327 C.G.S. (“award” of fees and expenses may be made directly in favor of person entitled to fees or expenses, and may or may not be combined with an award for compensation in favor of or against the injured employee). In this case, the April 8, 1996 “Supplemental Finding and Award No. 3” decreed not only the claimant’s entitlement to disability benefits, but his entitlement to a $25,000 attorney’s fee (as compensation for his counsel) and interest on the entire sum because of the Second Injury Fund’s undue delay in adjusting the claimant’s compensation. Finding, ¶ 13, 15. This type of consolidated award is commonplace in workers’ compensation.
Section 31-303 does not purport to distinguish between payments awarded to a claimant for his disability and payments awarded to attorneys or physicians as financial compensation for their efforts in providing professional services to the claimant. It merely states, “Payments due under an award shall commence on or before the tenth day from such award.” This language is not ambiguous. Although § 31-303 was certainly enacted to insulate injured employees from financial harm due to dilatory payments by employers and insurers; Casey, supra, 379; it is also true that a plain, straightforward construction of the term “award” as encompassing all of the payments specified in such an order does not counter the spirit of the Act or impede its objectives.
Significantly, the legislative history of this penalty provision consists of a statement by Representative Lawlor describing the bill as establishing “a 20 [percent] penalty for insurance companies or employers who make late payments of doctor bills or benefits for wage replacement after they have been ordered to be made by the workers comp[ensation] commission or after they were part of a voluntary agreement by the employer.” 36 H.R. Proc., Pt. 18, 1993 Sess., pp. 6253-54, quoted in Casey, supra, 378 n. 9. This comment does not imply that the benefit of § 31-303 was meant to be restricted to those moneys that are ultimately payable to the claimant. Medical expenses were considered to be part of the equation too, at least by the sponsor of the bill. We are obligated to apply the statute as it is written, for there is seldom a better indication of the legislature’s intent than the wording of the law itself. Vaillancourt v. New Britain Machine/Litton, 224 Conn. 382, 390 (1993). The simple and inclusive language of § 31-303 does not provide a basis upon which to hold that attorney’s fees are not meant to be included in the term “payments,” and it would be outside our jurisdiction to rule otherwise. Thus, we must rule that the trial commissioner should have assessed the twenty-percent penalty against the entirety of the April 8, 1996 award, rather than just the amount overdue for temporary total disability payments.
It is important to point out, however, that as a practical matter, this board perceives no logical reason why the legislature would have wished to enable attorneys to collect enhanced fees following a delay of greater than ten days in a respondent’s payment of an attorney’s bill. Unlike wage loss or specific indemnity benefits that, in retrospect, have often become payable to a claimant long before the date that an award is entered in his favor, the sum due an attorney has no direct relationship to the post-injury financial need of a claimant. Instead, an attorney’s fee constitutes payment for services rendered by that professional. Outside the workers’ compensation forum, we would hardly expect a lawyer to increase his bill by twenty percent if his client did not pay within ten days, nor would we expect such a penalty to be imposed by many other service providers or merchants. Why, then, is it advisable to provide such a windfall to a law firm if its bill is not paid immediately following the entry of an award?
There are provisions in the Act that entitle a claimant to interest if his claim is unreasonably contested, or payment is unduly delayed. Section 31-300. We also have regulations that entitle medical providers to interest if their bills are not paid within 60 days. Connecticut Practitioner Fee Schedule, General Guidelines, § 1. E.; see also Admin. Reg. § 31-280-3(b)(1) (requiring Chairman to establish, publish, and annually update a Practitioner Fee Schedule). The Act does allow a trial commissioner to allot fees to counsel in excess of 20%, if warranted, so attorneys can be accommodated if the complexity of the case merits it. See § 31-327; Prioli v. Connecticut State Library/Arts Commission, 3955 CRB-6-98-12 (Jan. 13, 2000). No such laws have been included, however, to protect attorneys from the late payment of their bills. This has never been seen as a concern intrinsic to the workers’ compensation forum; indeed, § 31-327 requires a commissioner to file an attorney’s fee award in court, making it subject to appeal and “enforceable by execution as in other cases.” Though this panel believes that it is bound to apply § 31-303 as broadly as it is written, we would be surprised if the legislature truly intended to offer attorneys the protection of a 20% penalty.
1 We note that the appellant did not present a transcript of whatever formal proceedings were held on January 19, 1999, so we must rely upon the representations of counsel as to what was discussed before the trier. BACK TO TEXT
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