Court Opinion

ID: 6336296
Source: CourtListenerOpinion
Date Created: 2022-04-29 14:06:19.016285+00
Date Added: 2024-06-11T09:24:10.420152
License: Public Domain

RENDERED: APRIL 22, 2022; 10:00 A.M.
                        NOT TO BE PUBLISHED

                Commonwealth of Kentucky
                          Court of Appeals

                             NO. 2020-CA-0701-WC

LEE HOWARD                                                         APPELLANT

               PETITION FOR REVIEW OF A DECISION
v.          OF THE WORKERS’ COMPENSATION BOARD
       ACTION NOS. WC-19-00183, WC-17-92247, AND WC-17-76944

STERICYCLE, INC.; DANIEL CAMERON,
ATTORNEY GENERAL;
HONORABLE JOHN B. COLEMAN,
ADMINISTRATIVE LAW JUDGE; AND
WORKERS’ COMPENSATION BOARD                                        APPELLEES

                                   OPINION
                                  AFFIRMING

                                 ** ** ** ** **

BEFORE: GOODWINE, MAZE, AND MCNEILL, JUDGES.

MAZE, JUDGE: Lee Howard (Appellant) appeals from an opinion of the

Workers’ Compensation Board (the Board) entered on April 24, 2020, affirming

the benefits awarded by the administrative law judge (ALJ). As the constitutional

challenges posited by Appellant have recently been rejected by the Kentucky

Supreme Court, we affirm the opinion of the Board.
                Appellant was in his sixties when he sustained work-related injuries

on February 23, 2017, and June 22, 2017, while employed by Stericycle, Inc.

(Appellee). He filed for workers’ compensation benefits and on December 13,

2019, an opinion, award, and order was entered as to injuries of the right and left

shoulders and denied as to his claim of cumulative trauma. He appealed the ALJ’s

order to the Workers’ Compensation Board, arguing that the 2018 amendment to

KRS1 342.730 (4), terminating his benefits at the age of 70, as well as its

retroactive application were unconstitutional. Although the Board affirmed the

ALJ’s order, it stated that it was without jurisdiction to reach a decision on the

issue of constitutionality.

                This appeal followed, in which Appellant claims that KRS 342.730

(4) and its retroactive application constitute violations of the Equal Protection and

Contracts Clauses of the United States and Kentucky Constitutions. However, at

the request of the Kentucky Attorney General, this Court held the matter in

abeyance pending decisions of the Kentucky Supreme Court in Cates v. Kroger,

627 S.W.3d 864 (Ky. 2021), and Dowell v. Matthews Contracting, 627 S.W.3d 890

(Ky. 2021). Following the rendition of those opinions, the parties were permitted

additional time in which to file supplemental briefs. While supplemental briefs

were filed on behalf of Appellee and on behalf of the Attorney General, no

1
    Kentucky Revised Statutes.
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additional materials were filed on behalf of Appellant. As the Court finds that the

Cates and Dowell cases are dispositive of the issues presented by Appellant, we

affirm.

             The version of KRS 342.730(4) applied by the ALJ and relied upon

by the Board became effective on July 14, 2018. It states that:

             All income benefits payable pursuant to this chapter shall
             terminate as of the date upon which the employee reaches
             the age of seventy (70), or four (4) years after the
             employee’s injury or last exposure, whichever last
             occurs. In like manner all income benefits payable
             pursuant to this chapter to spouses and dependents shall
             terminate as of the date upon which the employee would
             have reached age seventy (70) or four (4) years after the
             employee’s date of injury or date of last exposure,
             whichever last occurs.

             Subsection (3) of Section 20 of 2018 Ky. Acts ch. 40 specifically

states that the foregoing “shall apply prospectively and retroactively to all claims:

(a) [f]or which the date of injury or date of last exposure occurred on or after

December 12, 1996; and (b) that have not been fully and finally adjudicated, or are

in the appellate process, or for which time to file an appeal has not lapsed, as of the

effective date of this Act.” This subsection was not codified as part of the

Kentucky Revised Statutes.

             In Wynn v. Ibold, Inc., 969 S.W.2d 695, 696 (Ky. 1998), a workers’

compensation claimant challenged a 1994 age-related reduction in benefits as

unconstitutional. On appeal, the Court recognized that “acts of the legislature
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carry a strong presumption of constitutionality and that the principle of reducing

workers’ compensation benefits at an age when workers typically become eligible

for alternative forms of income replacement is not new to Kentucky.” The Court

stated that “[a] statute involving the regulation of economic matters or matters of

social welfare comports with both due process and equal protection requirements if

it is rationally related to a legitimate state objective.” Id. In affirming the

decisions of the lower courts, the Court concluded that “avoiding a duplication of

income benefits is a legitimate state objective and sound public policy.” Id. at 697.

Therefore, this rational relationship test has been adopted as the appropriate level

of scrutiny in constitutional challenges involving workers’ compensation claims.

               In Parker v. Webster County Coal, LLC (Dotiki Mine), 529 S.W.3d

759 (Ky. 2017), the Court applied this test in determining that the 1996 version of

the statute (in effect at the time of Appellant’s injury) treating older workers who

are eligible for Social Security differently than those who do not constituted an

equal protection violation pursuant to the 14th Amendment of the United States

Constitution and Sections 1, 2, and 3 of the Kentucky Constitution. The Court

reversed the decisions of the lower courts and invalidated the 1996 version of the

statute. The General Assembly then enacted the 2018 version that is at the heart of

this appeal.

                                           -4-
             Later, in Holcim v. Swinford, 581 S.W.3d 37, 44 (Ky. 2019), the Court

addressed the issue of statutory retroactivity specifically as applied to KRS

342.730(4). The Court concluded that the Legislative Research Commission was

not required to codify the retroactivity provision of the Act since it was

“temporary,” because “once cases arising during that time frame are fully

adjudicated, it will be unnecessary.” 581 S.W.3d at 44.

             Most recently, in Cates v. Kroger, 627 S.W.3d 864 (Ky. 2021), the

appellant challenged the constitutionality of the statute as amended in 2018 as well

as its retroactivity. The Court applied the rational basis standard and found that the

classification based on age as set forth in the statute furthers a matter of “social and

economic policy” because it prevents “a duplication of income benefits.” See

Wynn, 969 S.W.2d at 696.

             Additionally, the Court found that the General Assembly’s decision to

make the amendment retroactive was not an arbitrary one. The Court concluded

that, “[b]ecause the 1996 version had been invalidated and a new version enacted,

the General Assembly was left to decide if pending claims would be governed by

the 1994 version of the statute – a statute that had not been in effect for over 20

years – or to allow for current claims to be decided under the new amendment.

The legislative body apparently chose the latter, and that choice was its

prerogative.” Cates, 627 S.W.3d at 871-72.

                                          -5-
             In Dowell v. Matthews Contracting, 627 S.W.3d 890, 894 (Ky. 2021),

the Court addressed the Appellant’s second argument herein, whether the

application of the 2018 version of KRS 342.730(4) violates the Contracts Clause of

the United States and Kentucky Constitutions. In Article 1, Section 10, Clause 1,

the former provides that:

             No State shall enter into any Treaty, Alliance, or
             Confederation; grant Letters of Marque and Reprisal;
             coin Money; emit Bills of Credit; make any Thing but
             gold and silver Coin a Tender in Payment of Debts; pass
             any Bill of Attainder, ex post facto Law, or Law
             impairing the Obligation of Contracts, or grant any Title
             of Nobility.

             Section 19 of the Kentucky Constitution states that “[n]o ex post facto

law, nor any law impairing the obligation of contracts, shall be enacted.” In

Dowell, the Court found that “a complete Contracts Clause analysis is unnecessary

because the Workers’ Compensation Act (WCA) does not constitute a contract

between Kentucky workers and their employers or the state.” 627 S.W.3d at 894.

The Court concluded that “the benefits an employee may receive following a

work-related injury are not a result of a bargained-for exchange following an offer,

acceptance, and consideration, but are the result of a statutory scheme intended to

provide a form of insurance for Kentucky employees in case of injury. Because

the WCA does not form a contract, there are no contractual rights that the

amendment to KRS 342.730(4) could infringe; thus, the fundamental premise of a

                                         -6-
Contracts Clause analysis – the existence of a contract – is absent, and our analysis

ends.” Id. at 895.

             Accordingly, we affirm the opinion of the Workers’ Compensation

Board.

             ALL CONCUR.

BRIEF FOR APPELLANT:                       BRIEF FOR APPELLEE
                                           STERICYCLE, INC.:
Stephanie N. Wolfinbarger
Louisville, Kentucky                       Jo Alice Van Nagell
                                           Ryan D. Thompson
                                           Brian W. Davidson
                                           Lexington, Kentucky

                                           BRIEF FOR APPELLEE DANIEL
                                           CAMERON, ATTORNEY
                                           GENERAL:

                                           Daniel J. Cameron
                                           Attorney General of Kentucky

                                           Matthew F. Kuhn
                                           Brett R. Nolan
                                           Alexander Y. Magera
                                           Frankfort, Kentucky

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