Opinion ID: 1847474
Heading Depth: 1
Heading Rank: 7

Heading: interest assessment

Text: The Court of Appeals affirmed the review panel's conclusion that the trial judge incorrectly calculated the interest Kerry owed. The trial judge determined that under Neb.Rev.Stat. § 48-119 (Reissue 2004) and § 48-125, when a judge awards a claimant attorney fees, he or she is also entitled to interest on the total compensation owed when the employer paid the award, starting from the date that the compensation was first payable. But the review panel stated that interest does not accrue on the entire balance for the entire period. Instead, it concluded that the employer owed interest on each week of benefits as they became due until it paid the award. In her petition for further review, Russell does not dispute the review panel's method for calculating interest from the date each weekly installment of benefits became due until the date of payment. Instead, she contends that the trial judge's ruling was correct because the statutes show the Legislature intended to make the employer's delinquent payments costly to encourage the prompt payment of benefits. We view the question presented as whether the statutes require a trial judge to assess interest on the full amount of benefits owed from the first date that compensation was payable or to assess interest from the time each installment of benefits became due to the date of payment. Absent a statutory indication to the contrary, we will give words in a statute their ordinary meaning. [9] To the extent an appeal calls for statutory interpretation or presents questions of law, we must reach a conclusion independent of the lower court's determination. [10] A court must place on a statute a reasonable construction which best achieves the statute's purpose, rather than a construction which would defeat that purpose. [11] Section 48-125(3), in relevant part, provides: When an attorney's fee is allowed pursuant to this section, there shall further be assessed against the employer an amount of interest on the final award obtained, computed from the date compensation was payable, as provided in section 48-119, until the date payment is made by the employer, at a rate equal to the rate of interest allowed per annum under section 45-104.01, as such rate may from time to time be adjusted by the Legislature. Interest shall apply only to those weekly compensation benefits awarded which have accrued as of the date payment is made by the employer. Section 48-119 provides: No compensation shall be allowed for the first seven calendar days of disability . . . except that if such disability continues for six weeks or longer, compensation shall be computed from the date disability began. We do not view these statutes to specify whether a court can impose interest on the full amount of benefits owed from the first day that any compensation was payable or from the date that the benefits were due. But contrary to the trial judge's conclusion, the reference to § 48-119 in § 48-125(3) simply clarifies the start date for calculating interestnot that interest must be assessed on the full amount of benefits owed from the first day of compensation. And we reject Russell's argument that the Legislature intended this result to make delayed payments costly. The penalty for a delayed payment is imposed under § 48-125(1), which provides that [f]ifty percent shall be added for waiting time for all delinquent payments. . . . But it does not follow that every allowable cost under § 48-125 was intended as a penalty to the employer. The principal purpose of the Nebraska Workers' Compensation Act is to provide an injured worker with prompt relief from the adverse economic effects caused by a work-related injury or occupational disease. [12] Courts have reasoned that preaward interest is not a penalty but a means of fully compensating the claimant for not having use of the money that the employer owed. [13] Consistent with that purpose, courts have held that interest may be assessed on each installment of compensation benefits from the date it became due. [14] We agree with these decisions. Absent a clear indication that the Legislature intended an employer to pay interest on the full amount of benefits as a penalty, we believe that interest is assessed to fully compensate the claimant for not having the use of money to which he or she is entitled. Permitting interest on the full amount of benefits from a date when they were not yet owed is inconsistent with that purpose. We conclude that the review panel's calculation of interest from the date each installment became due was correct.