The Full Board, at its meeting held on July 17, 2012, considered the above captioned case for Mandatory Full Board Review of the Board Panel Memorandum of Decision (MOD) filed on November 7, 2011.
The carrier requests review of the decision of the Workers' Compensation Law Judge (WCLJ) filed on March 21, 2011. The claimant has filed a rebuttal.
The issue presented for Mandatory Full Board Review is whether a penalty was properly assessed against the carrier for untimely payment of awards pursuant to Workers' Compensation Law (WCL) § 25(3)(f).
The WCLJ found the carrier had untimely paid a schedule loss of use (SLU) award pursuant to a decision filed October 13, 2010, and assessed a penalty pursuant to WCL § 25(3)(f).
The Board Panel majority affirmed the WCLJ's decision.
The dissenting Board Panel member found that the wording of the October 13, 2010, decision was ambiguous, and therefore the WCLJ's decision to impose a penalty upon the carrier for untimely payment of an award should be rescinded.
The carrier filed an application for Mandatory Full Board Review filed on December 2, 2011.
The claimant filed a rebuttal filed December 28, 2011.
Upon review, the Full Board votes to adopt the following findings and conclusions.
The claimant, a marketing representative, sustained injuries to her knees and back when she was struck by a car on March 15, 2008. The case was initially established for both knees, and later amended to include an injury to the claimant's back and consequential post-traumatic stress disorder (PTSD).
The parties negotiated a resolution of the issue of permanency to both legs, and submitted a C-300.5 (Stipulation) form to the Board on September 29, 2010 (see CIS doc. # 171421546, received September 29, 2010). The stipulation provided for a 20% SLU of the right leg, 50% SLU of the left leg, allowed full credit for monies previously paid, allowed the carrier to take credit for settlement of the third party action, and stated that "[t]he entire award is to be paid at once in one lump sum."
A hearing was held on October 6, 2010, at which time the claimant and carrier's representatives were present and the signed agreement was approved by the WCLJ. At the October 6, 2010, hearing, claimant's representative stated that "[t]he schedule would run into the future and is payable up front" (see October 6, 2010, transcript, pg. 3). The WCLJ's decision incorporating the stipulation, filed October 13, 2010, states on page one of the decision that "[p]ayment at the rate of $489.61 per week would continue for 126.6 weeks until 3/12/2013." However, page two of the decision states that "the total schedule award, less payments already made, is to be paid in one lump sum without commutation to present value. The parties have stipulated on the record to these findings."
The carrier did not pay the full award within ten days of the October 13, 2010, decision, as corroborated by the November 1, 2010, check from the carrier in the Board file (see CIS doc. # 173648370, received November 24, 2010). The claimant filed an RFA-1 raising the issue of late payment of the award (see CIS doc. # 172829923, received November 3, 2010).
At a hearing held March 16, 2011, the carrier argued that the October 13, 2010, decision was ambiguous because on the first page, it directed payments to be paid into the future, and on the second page, indicated that the award should be paid in a lump sum. The carrier argued that it paid the balance of the award, albeit late, in good faith once they were advised by claimant's counsel that the whole award was to be paid immediately. As such, the carrier argued, there should be no penalty imposed. The claimant argued that a penalty was indicated.
The WCLJ found that per stipulation, the award was payable via lump sum, and the carrier untimely made payment pursuant to WCL § 25(3)(f), and assessed a penalty. These findings were memorialized in a decision filed March 21, 2011.
The carrier contends that the decision of the WCLJ to impose a penalty pursuant to WCL § 25(3)(f) was improper as the October 13, 2010, decision was ambiguous with respect to how the award was to be paid, and that it acted in good faith in paying the award in full once it "was advised that there was a potential conflict in how to interpret" the decision. The carrier argued that since it acted in good faith, although the award was paid untimely, no penalty should have been imposed, citing Matter of NYS Division of Police, 2010 NY Wrk Comp 50809037.
In rebuttal, the claimant argues that the Board Panel's decision should be affirmed. The claimant argues that as the carrier was present at the hearing and had signed the agreement, and was aware, or should have been aware, that the award was to be paid in a lump sum. The claimant distinguishes the case relied upon by carrier (Matter of NYS Division of Police, 2010 NY Wrk Comp 50809037), arguing that in the present case the written stipulation between the parties provided that the award was to be paid in a lump sum. In Matter of NYS Division of Police, there was no such stipulation.
When the employer or its insurance carrier has failed to "make payments of compensation according to the terms of the award within ten days … except in the case of an application to the board for a modification, rescission or review of such award," the Board imposes a penalty equal to 20% of the unpaid compensation (WCL § 25[f]). That penalty is payable to the injured worker or the injured worker's dependents (id.). "Section 25(3)(f)'s penalty provisions are self-executing, and the penalty is mandatory and automatic if the award is not timely paid (see, Matter of Surdi v Premium Coal & Oil Co., 52 NY2d 860 )" (Matter of Keser v New York State Elmira Psychiatric Ctr., 92 NY2d 100 ).
Here, the stipulation between the parties, signed by a representative of the carrier, clearly and unambiguously provides that the award is to be paid in a single lump sum. The October 13, 2010, decision incorporating the terms of the stipulation states, on page one, that "[p]ayment at the rate of $489.61 per week would continue for 126.6 weeks until 3/12/2013" (emphasis added) and then states on page two that the award "…is to be paid in one lump sum without commutation to present value." The use of the term "would," as opposed to "will" or "shall" on the first page of the decision clearly underscores that that statement is merely a calculation of how long the SLU award would extend, if not paid via lump sum. On the second page of the decision, the WCLJ clearly indicates that, as stipulated to by the parties, the award was to be paid in a single lump sum. There is no ambiguity in the October 13, 2010, decision that would obviate the carrier's obligation to pay the award within ten days of the decision. Therefore, the Full Board finds that a late payment penalty was properly assessed against the carrier.
ACCORDINGLY, the WCLJ decision filed on March 21, 2011, is AFFIRMED.