Opinion ID: 1825934
Heading Depth: 1
Heading Rank: 1

Heading: reimbursement from employee-claimants

Text: The Court of Appeals conceded that 1975 PA 34 might be unconstitutional if construed as limiting reimbursement only from the Second Injury Fund and noted that reimbursement also could be sought from the employee-claimant. I agree with Justice MOODY that the 70% act provides only one means of reimbursement, thereby excluding reimbursement from the employee who was wrongfully paid and also excluding any other means of reimbursement. However, my colleagues go further and say that the carrier should be required to pay the 70% of what is not owed and that no reimbursement is necessary. At least the Court of Appeals recognized a long line of Michigan cases holding that we cannot deprive a party of recoupment of money not owed but paid to a worker or beneficiary. This constitutional concept is basic and the 70% statute fails partially because it violates this tenet. Certainly I cannot agree with Justice MOODY that the legislation involved deals with property rights and therefore not fundamental rights. The fallacy is obvious. In Kirchner v Michigan Sugar Co, 206 Mich 459, 463, 465; 173 NW 193 (1919), the state accident fund by mistake overcompensated a worker. The fund sought reimbursement. The industrial accident board ordered that the total sum overpaid    shall be applied on the future compensation payable    until such overpaid amount is entirely consumed. The Court affirmed saying the worker was entitled to receive, and his employer is obligated to pay, no more and no less than the statute compensation. The board had authority to make such an order    to bring about, so far as possible, such desired and lawful result. In Webster v Rotary Electric Steel Co, 321 Mich 526, 532; 33 NW2d 69 (1948), the plaintiff's husband was killed while working. She and an infant daughter received benefits. When plaintiff remarried, a dispute arose concerning the child's benefits. On appeal the Court reduced the benefits. It also ordered that if overpayments were made, the amount shall be deducted from future payments. Also see Samels v Goodyear Tire & Rubber Co, 323 Mich 251, 259; 35 NW2d 265 (1948): One of the purposes of the compensation act is to afford the injured employee prompt relief and not permit it to be withheld while the employer delays payment by the filing of a petition or petitions to reduce compensation.    Nevertheless, where there has been no laches by the employer, the commission, when called upon by proper petition, should determine whether there has been an overpayment under the facts, as are presented in this case, and order the return of such overpayment either directly or by a credit on future payments. The act seeks just compensation, but not a penalty. (Emphasis added.) These cases were reviewed in Danford v Contract Purchase Corp, 333 Mich 559, 567; 53 NW2d 377 (1952), where plaintiff, a widow, received a lump-sum advance payment to cover 129 weeks of benefits. Before that time expired, she remarried. The company sought reimbursement which the commission granted and this Court affirmed: Her right to further compensation under the statute was terminated by her. Under the facts presented here we are in accord with the holding of the compensation commission that under the statute, reasonably interpreted, the amount paid to her in anticipation of future payments that it was assumed she would be entitled to receive must be regarded as an overpayment. In ordering the return the commission did not exceed its authority. (Emphasis added.) [4] MCLA 418.827; MSA 17.237(827) permits an employee receiving compensation to begin an action to enforce the liability of a third party. However, any recovery after deducting expenses of recovery, shall first reimburse the employer or carrier for any amounts paid or payable    to the date of recovery and the balance    shall be treated as an advance payment by the employer on account of any future payments of compensation benefits. The plaintiff in Pelkey v Elsea Realty & Investment Co, 394 Mich 485; 232 NW2d 154 (1975), claimed that the statute above violated due process and equal protection guarantees by crediting money received for pain and suffering. We noted that at one time the employee had to elect a remedy  workmen's compensation or tort. Now, the employee can pursue both. We did not find the provision for reimbursement to be an arbitrary denial of a property right. The reimbursement is justified by the abrogation of the election of remedies requirement. These cases underscore a conclusion that a company or carrier has a right to be fully reimbursed for being required to pay benefits to undeserving claimants. Full reimbursement means a dollar back for a dollar paid.