Opinion ID: 1876325
Heading Depth: 1
Heading Rank: 2

Heading: 18% interest and attorney's fees

Text: The employer asserts that the finding that it refused to pay TTD without reasonable ground constituted an abuse of the ALJ's discretion. Arguing that its conduct was not unreasonable, the employer states that no published judicial decision addressed the legal basis that it raised for doing so. The employer maintains that the sole reason for the ALJ's findings under KRS 342.040(1) and KRS 342.310(1) was the fact that it lost its primary argument. A longstanding policy of Chapter 342 is to encourage employers to pay income benefits voluntarily when warranted. KRS 342.040(1) requires them to begin to pay benefits when a worker misses more than seven days of work after an injury. It imposes 12% interest on past-due benefits if the employer is later found to be liable for such benefits but permits 18% interest to be awarded if an employer's denial, delay, or termination of benefits was without reasonable foundation. KRS 342.310(1) permits an ALJ to assess the whole cost of the proceedings, including attorney's fees, on a party who has brought, prosecuted, or defended such proceedings without reasonable ground. Sexton v. Sexton, 125 S.W.3d 258, 272 (Ky. 2004), explains that the test for an abuse of discretion is whether the resulting decision was arbitrary, unreasonable, unfair, or unsupported by sound legal principles. KRS 342.125(3) and (8) have limited the period for filing a motion to reopen since December 12, 1996. They clearly base the periods of limitations on dates other than the date of injury, and KRS 342.125(8) clearly applies the four-year period of limitation and the exceptions to all claims irrespective of when they were incurred. KRS 342.125(6) concerns the duration of income benefits awarded in a reopening rather than the procedure for reopening. Peabody Coal Co. v. Gossett, supra , explained in 1991 that an amendment concerning a remedy or mode of procedure does not come within the legal concept of a retrospective law and does not require a legislative declaration. Like the present case, it concerned an amendment to KRS 342.125. Meade v. Reedy Coal Co., supra , determined in 2000 that the 1996 amendments to KRS 342.125(3) and (8) are remedial and that KRS 342.125(8) permits any claim to be reopened at any time upon proof of one of the exceptions to reopening. The 2000 amendment extended the period for filing a motion to obtain TTD and did so before the four-year period stated in KRS 342.125(3) expired. In 2003, Johnson v. Gans Furniture Industries, Inc., supra , upheld the constitutionality of the 2000 amendment, noting explicitly that to permit a motion seeking TTD to be filed in any claim at any time furthered the purpose of the 1996 amendment. It was unreasonable under the circumstances for the employer to argue in 2004 that the 2000 amendment to KRS 342.125(3) was not remedial absent a legislative statement to that effect; that the last sentence of KRS 342.125(6) required the ALJ to consider the claimant's motion under the 1996 amendment to KRS 342.125(3); or that the 2000 amendment did not apply because the injury occurred before its effective date. Because the arguments were unreasonable, the decision requiring it to pay 18% interest and attorney's fees was not an abuse of discretion. The decision of the Court of Appeals is affirmed. All sitting. All concur.