Opinion ID: 1284735
Heading Depth: 1
Heading Rank: 3

Heading: self-insurers' security fund

Text: Plaintiff argues a second source of recovery in the Self-Insurers' Security Fund (SISF), created to provide payments for a disabled employee who    is entitled to receive workmen's compensation benefits from a private self-insured employer who becomes insolvent after the effective date of this section and is unable to continue the payments. MCLA 418.537(1); MSA 17.237(537)(1). GMP became insolvent October 1, 1971. Because the legislation was effective November 16, 1971, the question of retroactive application arises. When plaintiff presented his claim, the hearing referee and the WCAB ordered the SISF to pay benefits. The Court of Appeals reversed. [1] It said the statutory language operates as a limitation upon the authority    to make disbursements from the [f]und. Plaintiff argues that MCLA 418.537(2); MSA 17.237(537)(2) acts as a grandfather clause by permitting payments to an employee    disabled    while in the employ of a private self-insured employer who has become insolvent. He claims subsection (1) applies to insolvencies after the effective date and subsection (2) applies to those before the effective date. [2] The Court of Appeals found this construction to be untenable. Such an analysis would require this Court to first hold that the Legislature specifically created two different classes of employees in subsection (1), and then hold the Legislature intended that the distinction so emphatically delineated in subsection (1) was of no consequence. Surely had the Legislature intended that all disabled employees of self-insured employers should have a right to claim against the Fund irrespective of when their employers became insolvent, the Legislature would not have used the language of limitation found in subsection (1). The Court said subsection (1) defines the class of employees covered    while subsection (2) sets forth the manner in which said employees shall file their claims against the [f]und. 51 Mich App 250-251. The Attorney General, for SISF, supports the Court of Appeals conclusion and says: In the creation of the SISF and in the subsequent enactment of Act 149, the Legislature did not disturb any of the pre-existing rights and liabilities, under Federal or state laws, between the employee and the insolvent self-insured employer. The employee may still present his claim in either the state or Federal insolvency proceedings or take whatever other legal action may be appropriate to satisfy the insolvent self-insured employer's liability to him. To the existing rights and remedies, the Legislature gave a new, but limited, statutory option to the employees to shift present and future compensation liability of the insolvent self-insured employer to the Self-Insurers' Security Fund. The statute requires, however, that the employee must request the payment of benefits. MCLA 418.537(2), and 418.537(3) [MSA 17.237(537)(2), 17.237(537)(3)]. The fund submits that the creation of the fund and its method of financing by assessing present self-insured employers provides a substantive right to those employees whose compensation claims are within the limited authority of the trustees to make payments from the fund. Because it is a settled rule of statutory construction that statutes ordinarily are prospective in application unless the contrary clearly appears from the context of the statute itself [3] and because it does not appear that this statute establishing new substantive rights so provides, we hold that it is not retroactive.