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Case # 90700001
Date of Accident: 12/03/2006
District Office: Binghamton
Employer: Founders Pavilion, Inc.
Carrier: Ins Co of State of Penn
Carrier ID No.: W117006
Carrier Case No.: 709-416178
Date of Filing of Decision: 03/07/2013
Claimant's Attorney: Hutchison & Maio
Panel: Robert E. Beloten

MANDATORY FULL BOARD REVIEW
FULL BOARD MEMORANDUM OF DECISION

The Full Board, at its meeting held on January 15, 2013, considered the above captioned case for Mandatory Full Board Review of the Board Panel Memorandum of Decision filed on March 19, 2012.

ISSUE

The issue presented for Mandatory Full Board Review is whether the carrier remained responsible to make a deposit into the Aggregate Trust Fund (ATF), despite the death of the claimant subsequent to the deposit direction.

The Workers' Compensation Law Judge (WCLJ) directed an ATF deposit based upon the classification of the claimant with a permanent partial disability (PPD). By a supplemental decision, the deposit was calculated in the amount of $127, 241.44.

The Board Panel majority, in a decision filed March 19, 2012, affirmed the WCLJ's decisions.

The dissenting Board Panel member found that the ATF deposit directive should be rescinded due to the claimant's death, or, in the alternative, that the case should be restored to the trial calendar for recalculation of the appropriate deposit amount given the claimant's intervening death.

In its application for Mandatory Full Board Review, the carrier argues that its financial obligation to the claimant was extinguished upon her death on April 24, 2010, and that it should not be required to make a deposit into the ATF as previously directed.

In rebuttal, the ATF argues that the ATF deposit should still be made, that the ATF was an aggregate and indivisible fund which was funded for the benefit of all relevant claimants, and that what it may gain in one case may be lost in another.

Upon review, the Full Board votes to adopt the following findings and conclusions.

FACTS

The claimant, a certified nursing assistant, sustained an injury to her right hip on December 3, 2006, when she slipped in water and fell. The case was established for an injury to the claimant's right hip by a decision filed September 4, 2007. By a decision filed February 17, 2009, the case was amended to include a consequential back condition.

By a decision filed September 17, 2009, the claimant was classified with a PPD at a 66.67% rate and an ATF deposit was directed. That decision was affirmed by a Board Panel decision filed December 28, 2009. The carrier filed a Notice of Appeal of that decision to the Appellate Division, Third Department.

In a supplemental decision filed December 28, 2009, the ATF deposit was calculated in the amount of $127,241.44 as of March 17, 2010. By an application filed January 26, 2010, the carrier requested administrative review of the December 28, 2009, supplemental decision, arguing that it was improper for the Board to set the ATF deposit amount while its appeal to the Third Department of the decision affirming the carrier's obligation to make an ATF deposit was still pending. The carrier further argued that it was "unclear as to how the amount [of the ATF deposit] was calculated," and requested "that the matter be returned to the trial calendar for the cross-examination of the actuarial department." The carrier's application for review of the supplemental decision has not been directly addressed by the Board.

The claimant died from unrelated causes on April 24, 2010. The Board issued an administrative decision filed June 4, 2010, which would have become final on July 1, 2010, if not objected to, which made awards from August 29, 2007, to April 24, 2010, at the rate of $329.47 per week. However, by a letter dated June 22, 2008, the carrier objected to the June 24, 2010, administrative decision, arguing that awards should have been made at the rate of $283.86, not $329.47.

The Board issued an amended administrative decision on October 27, 2010, which made awards from August 29, 2007, to February 12, 2009, at the rate of $329.47 per week, and from February 12, 2009, to April 24, 2010, at $292.86 per week. No mention was made in the decision of the previously directed ATF deposit.

By an application filed November 19, 2010, the carrier requested review of the WCLJ decision filed September 17, 2009, which had found that the carrier was obligated to make an ATF deposit, the WCLJ's supplemental decision filed December 28, 2009, which set the ATF deposit amount, and the amended administrative decision filed October 27, 2010. The carrier argued that since the claimant has died, the Board should rescind the direction that the carrier is to make a deposit into the ATF.

LEGAL ANALYSIS

ATF Deposit – Claimant's Death

In the sur-rebuttal, the carrier argues, in addition to arguments contained in its Mandatory Full Board Review application, that the ATF deposit never became due because it was being appealed when the claimant died.

As part of the Reform Legislation of 2007, the legislature amended Workers' Compensation Law (WCL) § 27(2) to provide, in relevant part:

"if any such award made on or after July first, two thousand seven requires payment for permanent partial disability under paragraph w of subdivision three of section fifteen of this article by an insurance carrier which is a stock corporation or mutual association, which for the purposes of this section shall be known as mandatory type cases, the board shall immediately compute the present value thereof and require payment of such amount into the aggregate trust fund, together with such additional sum as the board may deem necessary for a proportionate payment of expenses of administering such trust fund including the cost of the actuarial computation by or on behalf of the board of the present value of the award …"

The direction for a carrier to make an ATF deposit is stayed pending the carrier's appeal to the Appellate Division, as long as the carrier continues to pay compensation benefits to the claimant as awarded (WCL § 23). That stay continues during the pendency of the appeal, and if the Court affirms the direction for the carrier to make payments into the ATF, the carrier is entitled to credit for payments it made to the claimant (id.; see generally Matter of Presbyterian Hosp., 2009 NY Wrk Comp 00124050).

In this instance, while the claimant was still living, the carrier sought administrative review of the direction of the ATF deposit. When the Board Panel, in its decision filed December 28, 2009, affirmed the finding that the carrier was obligated to make an ATF deposit, the carrier filed a Notice of Appeal of that decision to the Appellate Division, Third Department. However, the carrier never perfected that appeal, which is now deemed abandoned (see 22 NYCRR 800.12).

The carrier's liability to make a deposit into the ATF was fixed as of the supplemental decision filed December 28, 2009, and set the present value of future awards at $127, 241.44 as of March 17, 2010 (see Matter of Goldstein v Lackawanna Steel Constr. Corp., 261 AD 856 [1941]; Matter of Marconi v Marshall, 284 AD 728 [1954]). That decedent died after the carrier's obligation to make an ATF deposit was fixed, but before it made the required payment into the ATF, does not relieve the carrier of that obligation (see Matter of Becker v Rauli & Sons, Inc., 88 AD3d 1040 [2011]).

Further, the carrier, in its application for review of the decision filed January 26, 2010, argued that it was improper for the Board to set the ATF deposit amount while its appeal to the Third Department of the decision affirming the carrier's obligation to make an ATF deposit was still pending. Since that appeal has been abandoned, this issue is moot. The carrier further argued that it was "unclear as to how the amount [of the ATF deposit] was calculated," and requested "that the matter be returned to the trial calendar for the cross-examination of the actuarial department." The carrier based this argument on its assertion that pursuant to WCL § 15(3)(w), claimant was entitled to a maximum of 375 weeks of PPD benefits at the rate of $292.86, and that the ATF deposit amount directed by the Board exceeded the total amount of claimant's maximum PPD awards. However, insofar as claimant's accident occurred prior to March 13, 2007, claimant's PPD benefits are not capped (Section 82 of Chapter 6 of the Laws of 2007). Accordingly, the WCLJ's December 28, 2009, supplemental decision is affirmed in its entirety.

Therefore the Full Board finds the record supports a finding that the carrier is obligated to make the previously directed deposit in the ATF despite the intervening death of the claimant.

Lastly, the Full Board finds that the carrier's application was made "for the purpose of delay or upon frivolous grounds" and hereby imposes a frivolous appeal penalty in the amount of $500.00 against the carrier pursuant to WCL § 23.

CONCLUSION

ACCORDINGLY, the WCLJ decisions filed on September 17, 2009, and December 28, 2009, and the Amended Administrative Decision filed October 27, 2010, are AFFIRMED. The Full Board also hereby imposes a frivolous appeal penalty in the amount of $500.00 against the carrier pursuant to WCL § 23.