Opinion ID: 2509483
Heading Depth: 2
Heading Rank: 2

Heading: The Scope of Forfeiture Under Section 8-43-402

Text: Section 8-43-402 was enacted in 1915 as part of Colorado's workmen's compensation statutes and remains largely unchanged from its original form. [4] Moreover, the forfeiture language at issue here is the same as that used in the 1915 Act and has not been interpreted by this Court since its original enactment. The provision defines a class-five felony offense for willfully making a materially false statement to obtain workers' compensation benefits. § 8-43-402. If convicted, a claimant faces possible imprisonment pursuant to section 18-1.3-401, C.R.S. (2004) and shall forfeit all right to compensation under the Act. [5] Id. Wolford and Pinnacol assert different interpretations of section 8-43-402. Wolford acknowledges that a conviction under section 8-43-402 results in the forfeiture of workers' compensation benefits, however, she insists the forfeiture is limited to only those benefits that were obtained as a result of the false statements. Pinnacol urges a broader reading of the provision, claiming that a conviction under section 8-43-402 results in the forfeiture of all benefits associated with any single workers' compensation claim, including the forfeiture of both TTD and PPD compensation stemming from the same workers' compensation claim where Wolford was convicted of making false statements to obtain TTD benefits. Although both parties insist on some limitation on the broad forfeiture language used in section 8-43-402  all right to compensation under said articles  neither party convincingly identifies any language in the provision for which a limitation could attach. As such, a possible third, broader, interpretation exists which would result in the forfeiture of all compensation under the Act, both past and future. Such an interpretation would, in effect, result in a lifetime suspension from receiving workers' compensation upon a conviction under section 8-43-402. As we examine the scope of the forfeiture provision in section 8-43-402, we are mindful that this section was not adopted in isolation but enacted as one piece of the Act. In interpreting a comprehensive legislative scheme, we must construe the statutory provisions to further the intent of the General Assembly. A.B. Hirschfeld Press, Inc. v. City and County of Denver, 806 P.2d 917, 920 (Colo.1991). A comprehensive regulatory scheme such as the Act must also be construed as a whole to give effect and meaning to all its parts. Gonzales v. Advanced Component Sys., 949 P.2d 569, 574 (Colo.1997). In doing so, we note that the Act is intended to be remedial and beneficent in purpose, and should be liberally construed to accomplish these goals. Davison v. Indus. Claim Appeals Office of State, 84 P.3d 1023, 1029 (Colo.2004) (internal citations omitted). If we can give effect to the commonly accepted and understood meaning of the language used in a statute, [we] should construe the statute as written. Gonzales, 949 P.2d at 574. However, where discrete provisions of the same statutory scheme may be harmonized, but would be antagonistic under a different construction, the court should adopt the construction that results in harmony. Id. Thus, we must interpret a statute to give effect to all its parts and avoid interpretations that render statutory provisions redundant or superfluous. Colo. Comp. Ins. Auth. v. Jorgensen, 992 P.2d 1156, 1163 (Colo.2000). When read in isolation, the phrase shall forfeit all right to compensation in section 8-43-402 appears to encompass all compensation, past and future. However, additions to the Act since it was repealed and re-enacted in 1990 not only convey the General Assembly's contrary intent and understanding of section 8-43-402, but render such a broad interpretation of the forfeiture unworkable. Specifically, when looking to the Act as a whole to determine the extent of the forfeiture provision in section 8-43-402, there exist two additional provisions of the Act that address false statements or benefits obtained through fraud and must be taken into consideration. First, section 8-43-304(2), C.R.S. (2004), allows an insurer or self-insured employer to take an offset or credit against compensation owed to a claimant for previously paid benefits that were obtained through fraud. Second, section 8-42-112(1)(d), C.R.S. (2004), which establishes a fifty-percent penalty in workers' compensation for misleading statements made by a claimant to her employer about her physical ability to perform the job. The fifty-percent penalty is in addition to any other penalty that may be imposed under section 8-43-402. § 8-42-112(1)(d). Because these provisions contemplate that a workers' compensation claimant will still be entitled to some compensation following the application of the forfeiture provision, we find that section 8-43-402 cannot be read as a complete forfeiture of all compensation under the Act. Section 8-43-304(2) was enacted in 1991. Ch. 219, sec. 35, § 8-43-304(2), 1991 Colo. Sess. Laws 1291, 1323-24. The provision directly contemplates that a claimant will still be entitled to some benefits after a criminal conviction is entered against her under section 8-43-402. Section 8-43-304(2) allows an insurer to offset benefits due a claimant for previously paid benefits that were obtained through fraud. Section 8-43-304(2) states: An insurer or self-insured employer may take a credit or offset of previously paid workers' compensation benefits or payments against any further workers' compensation benefits or payments due a worker when the worker admits to having obtained the previously paid benefits or payments through fraud, or a civil judgment or criminal conviction is entered against the worker for having obtained the previously paid benefits through fraud. The insurer is entitled to such an offset or credit under three circumstances: (1) where the claimant admits to obtaining benefits through fraud, (2) where a civil judgment has been entered against the claimant for obtaining the benefits through fraud, or (3) where the claimant is convicted of criminally obtaining benefits through fraud. § 8-43-403(2). The first and third scenarios are relevant here because the facts giving rise to either of these scenarios may also give rise to a criminal conviction under section 8-43-402. That is, a significant overlap exists between section 8-43-402 and section 8-43-304(2) because both are implicated where a claimant obtains workers' compensation benefits through fraud. For example, this overlap occurs where a claimant enters into a plea agreement (admitting to the crime) or is convicted at trial under section 8-43-402 and the underlying facts of the conviction show that the false statements made by the claimant constitute fraud. [6] Where the overlap occurs and the compensation benefits were obtained by fraud, the insurer or self-insured employer may then claim an offset for those benefits already paid as a result of the fraud against those benefits still due the claimant. This overlap is significant because it affects how the General Assembly understood these separate provisions to relate. If we were to find that section 8-43-402 requires a claimant to forfeit all compensation under the Act for a conviction of making false statements to obtain workers' compensation benefits, there would be no benefits remaining against which to apply the offset provision of section 8-43-304(2). When the General Assembly chose to legislate and adopt section 8-43-304(2), it is presumed to be aware of its other enactments. See Anderson, 102 P.3d at 330. Here, we presume the General Assembly was aware of section 8-43-402 and the effect of the forfeiture provision on compensation benefits and did not understand section 8-43-402 to render a complete forfeiture of all compensation under the Act. Otherwise, if we were to apply section 8-43-402 to forfeit all workers' compensation benefits, including those not obtained through fraud or false statements, we would render the criminal conviction portion of section 8-43-304(2) meaningless and contravene the intent of the General Assembly. Section 8-43-304(2) does not stand alone as the only evidence of the General Assembly's understanding that section 8-43-402 requires less than a complete forfeiture of all a claimant's compensation under the Act. Section 8-42-112(1)(d), enacted in 1999, requires workers' compensation provided under the Act be reduced by fifty percent if a claimant willfully misled his employer concerning his physical ability to perform the job and was subsequently injured as a result. [7] Ch. 139, sec. 1, § 8-42-112(1)(d), 1999 Colo. Sess. Laws 406, 406. This fifty-percent penalty is to apply in addition to any other penalty that may be imposed under section 8-43-402. Again, by the express language used, section 8-42-112(1)(d) overlaps with section 8-43-402. Given this overlap, it is evident that the General Assembly contemplates some amount of compensation remaining due to a claimant after the application of the forfeiture provision in section 8-43-402. In the situation where the claimant's misleading or false statements about her physical ability to perform the job also resulted in a conviction under 8-43-402, section 8-42-112(1)(d) assumes that the fifty-percent penalty would apply in addition to the forfeiture provision of 8-43-402. If we were to interpret section 8-43-402 to render a complete forfeiture as urged by Pinnacol, there would be no possibility of any compensation being due a claimant and our interpretation would therefore contravene the General Assembly's comprehension of the statute and render the reference to section 8-43-402 in section 8-42-112(1)(d) superfluous. Given the significant overlap with other sections of the Act, it is apparent that the broad interpretation of section 8-43-402 as urged by Pinnacol and adopted by the court of appeals would be antagonistic to these provisions. More specifically, a complete forfeiture of all compensation under the Act would conflict with the application of sections 8-43-304(2) and 8-42-112(1)(d). As a result, we cannot adopt such an interpretation. Having determined that section 8-43-402 cannot be applied so broadly as to render a forfeiture of all compensation, we must determine how to apply the provision. We look to a narrower construction of section 8-43-402 that best reflects the remedial purpose of the Act and incorporates the intent of the General Assembly. We must also construe the provision so that it is in harmony with the rest of the Act. See Gonzales, 949 P.2d at 574. We conclude that the forfeiture provision is best read as only a forfeiture of compensation obtained as a result of the false statements. That is, there must be a nexus between the false statements and the compensation forfeited. First, we are persuaded that a narrow construction of section 8-43-402 serves the remedial and beneficent purpose underlying Colorado's workers' compensation system. See Davison, 84 P.3d at 1029. Requiring a nexus between the false statements and the compensation forfeited gives a claimant a remedy for those injuries suffered on the job and permits compensation where the claimant is entitled to such benefits. The nexus requirement avoids the loss of benefits for which an insurer or self-insured employer concedes liability simply because of false statements unrelated to a claimant's right to redress for her injuries. The General Assembly specifically instructs that the Act is to be interpreted so as to assure the quick and efficient delivery of disability and medical benefits to injured workers at a reasonable cost to employers ... recognizing that the workers' compensation system in Colorado is based on a mutual renunciation of common law rights and defenses by employers and employees alike. § 8-40-102(1), C.R.S. (2004). Because the Act limits the remedy for work-related injuries to the workers' compensation system and prohibits an injured employee from seeking compensation through traditional court proceedings, a complete forfeiture of all compensation, including compensation unrelated to the false statements, would result in a severe penalty permanently depriving the injured claimant a remedy. Such a measure would defeat the purpose of the system and contradict what is intended to be a remedial process. At the same time, our narrow construction also preserves the deterrent effect of section 8-43-402. The nexus requirement still presents a claimant with the prospect of forfeiting the right to compensation if she makes false statements to acquire payments. Consequently, a claimant is dissuaded from exaggerating claims or attempting to seek compensation to which she is not otherwise entitled. In addition, our narrow construction of the forfeiture provision also encourages claimants to be truthful during the claims process, fostering a compensation system that is both quick and efficient in delivery of disability compensation. Last, by requiring a nexus between the false statements and the compensation forfeited, we can give effect to the other provisions in the Act. As noted above, both section 8-43-304(2) and section 8-42-112(1)(d) contemplate that some compensation will still be due a claimant after a conviction under section 8-43-402. As such, any construction of the forfeiture provision must allow the possibility that some compensation will remain due a claimant after a conviction. If the forfeiture is limited to only that compensation obtained as a result of the false statements, there remains a possibility that a claimant would still be entitled to the compensation that was not acquired with false statements. In a case where, as here, a claimant makes false statements that she is not working in order to receive TTD compensation, she would forfeit all right to TTD compensation. Assuming no false statements were made to obtain PPD compensation, the claimant would still be entitled to that compensation. In contrast, where a claimant makes false statements to inflate the severity of her work-related injuries, to the extent those false statements resulted in increased temporary disability and permanent disability payments, the claimant would forfeit all right to both temporary and permanent disability compensation. Were we to adopt the court of appeals' construction of section 8-43-402, there would be no possibility that a claimant would still be entitled to any compensation under the Act following a conviction for either of these statements. Requiring a nexus between the false statements and the compensation forfeited gives effect to both section 8-43-304(2) and section 8-42-112(1)(d). Section 8-43-304(2) remains effective because an insurer can take an offset against any remaining compensation after a conviction under section 8-43-402. Similarly, the remaining compensation would be subject to the fifty-percent penalty as contemplated under section 8-42-112(1)(d). In requiring a nexus, we avoid rendering these provisions hollow and give effect to the Act as a whole. For these reasons, we hold that a claimant forfeits only the disability compensation obtained as a result of the false statements for which she was convicted under section 8-43-402.