CASE NO. 5687 CRB-2-11-10
COMPENSATION REVIEW BOARD
WORKERS’ COMPENSATION COMMISSION
SEPTEMBER 18, 2012
THE PHINEAS CORP. d/b/a SUNRISE GROUP
LIBERTY MUTUAL INSURANCE
SECOND INJURY FUND
The claimant appeared on her own behalf at oral argument.
The issue before the trial commissioner and the issue on appeal did not involve respondents The Phineas Corp., and Liberty Mutual Insurance. Therefore they did not participate in the proceedings before the board.
The respondent Second Injury Fund was represented by Yinia Long, Esq., Assistant Attorney General, Office of the Attorney General, PO Box 120, Hartford, CT 06141-0120.
This Petition for Review1 from the September 26, 2011 Finding and Dismissal of the Commissioner acting for the Second District was heard June 22, 2012 before a Compensation Review Board panel consisting of the Commission Chairman John A. Mastropietro and Commissioners Jodi Murray Gregg and Daniel E. Dilzer.
JOHN A. MASTROPIETRO, CHAIRMAN. The claimant in this matter has appealed from a Finding and Dismissal which determined that the respondent was not subject to statutory penalties for the manner in which they sent the claimant a settlement check following a stipulation. While the respondent was forced to send a second check to the claimant following difficulties they encountered with the U.S. Postal Service, the trial commissioner determined that the respondent acted in a reasonable manner. We believe the trial commissioner reached a reasonable decision herein based on the facts and law. We affirm the Finding and Dismissal.
The trial commissioner found the following facts at the conclusion of the formal hearing. The claimant sustained a compensable injury at her employer in 1999 and a voluntary agreement for eighteen percent permanent partial disability of her shoulder was approved on April 30, 2009. The Second Injury Fund (“Fund”) became a party to the claimant’s case by virtue of the concurrent employment provisions of § 31-310(a) C.G.S. The parties reached an agreement for a full-and final settlement of indemnity benefits (along with a partial settlement of future medical expenses) in the amount of $300,000. The carrier for the claimant’s employer at the time of her injury, Liberty Mutual, agreed to pay $245,000, of which $25,000 was expected to cover future medical expenses. The balance of $55,000 was to be paid by the Fund. Patricia Taylor, Administrative Hearing Representative for the Fund, signed the stipulation on their behalf on July 7, 2010.
Commissioner Donald Doyle approved the stipulation on July 9, 2010. The agreement included the following provision as to payment terms.
The claimant and the respondent hereby agree that, to the extent that the statutory provision contained in Conn. Gen. Stat. § 31-303 are construed to apply to this stipulation, the claimant agrees to waive the 20% penalty provided for [sic] that section, if full payment is made by the respondent-fund and receive within twenty business (20) days after approval of the stipulation by the Commissioner. Nothing herein shall constitute an admission by any of the parties that the provisions of § 31-303 apply to this stipulation.
Findings, ¶ 7.
This provision was drafted by the Fund and included in the agreement at the direction of Commissioner Doyle, who wanted to ensure the settlement funds were sent to the claimant in a timely manner. The Fund had signed this stipulation in advance of the hearing where Commissioner Doyle approved the stipulation and they did not attend. The claimant did attend the hearing and Commissioner Doyle explained this provision to her at that time. Based on the representations of Commissioner Doyle at the approval hearing, the claimant believed she would have both her checks within twenty days of the approval. Were this not to occur, the claimant thought that she would be entitled to a twenty percent penalty. Liberty Mutual issued its check to the claimant and sent it via the U.S. mail and it was received a few days later.
On July 14, 2010, the Fund received a copy of the approved stipulation. The Fund, which is a unit of the State Treasurer’s office, needed to requisition a check from the State Comptroller’s office. On July 30, 2010, the State Comptroller’s office printed a check numbed 13146357. This check was for $55,000 and was made payable to the claimant. The check itself was attached to a stub which included the claimant’s mailing address, and which was placed in a window mailing envelope. This envelope was properly addressed to Ms. Marchand at her residence in Sterling, CT and contained check number 13146357, and was run through the postage meter at the Comptroller’s office. Appropriate postage of forty-four cents was properly applied. It was then turned over to the U.S. Postal Service. This envelope was then sorted by the U.S. Postal Service, which applied a barcode corresponding with the claimant’s nine-digit zip code and home delivery route number. On Friday, August 13, 2010, the claimant called and spoke with Ms. Taylor. The claimant informed Ms. Taylor that she had not received the check. At that time the claimant told Ms. Taylor that she had experienced trouble with her mail in the past, possibly theft.
Once the parties became aware the check had not arrived as anticipated they discussed the possibility of putting a stop payment order on the first check and issuing a replacement check. Since it was confirmed the check had been mailed, and since it was still possible the original overdue check might arrive, no stop payment was issued at that time. On August 23, 2010, the claimant advised the Fund she still had not received the check and it was agreed a new check would be issued. A stop payment was issued on the old check. On September 2, 2010, the Comptroller’s office issued a replacement check bearing number 13177266. This check was in the amount of $55,000 and was made payable to the claimant. Apart from the check date and check number, both the check and the attached stub were identical to what was mailed on July 30, 2010. Because of concerns that Ms. Marchand’s mail might be stolen, the September 2, 2010 check was sent to her by certified mail. Ms. Taylor personally delivered the envelope/check to the U.S. Post Office on September 8, 2010. The claimant received the replacement check on September 9, 2010. That same day, the original check was received at the State Comptroller’s office in a damaged, partially opened envelope; with indicia on the envelope that postage had been cancelled by the Postal Service in Hartford on the afternoon of August 12, 2010.
An employee of the Comptroller’s office, unaware of the stop payment order on the first check, remailed it to the claimant in a new envelope on September 10, 2010. This check was received on September 11, 2010. At that point, the claimant had already received the replacement check and the original check was no longer negotiable. The claimant contacted the Fund to advise Ms. Taylor of her receipt of the original check, and the fact that it was postmarked well after the payment deadline. The claimant then sought a hearing before the commission claiming she was entitled to obtain penalties for late payment.
The trial commissioner concluded based on these facts that the Fund mailed a check for their share of the settlement on the 12th business day after the stipulation was approved. The claimant did not receive these funds within twenty days of approval of the stipulation or within twenty days of the Fund receiving a copy of the approved stipulation. The commissioner found the Fund stopped payment on the first check and issued a replacement check. He concluded “[t]he Fund’s actions after learning of the failed delivery of the first check were reasonable, appropriate and non-dilatory.” Conclusion, ¶ I.
He therefore determined the claimant failed to prove she was entitled to a twenty percent penalty for late payment under either the stipulation agreement or § 31-303 C.G.S.2 The trial commissioner also issued an eighteen page Memorandum of Decision outlining in detail his legal reasoning behind the Finding and Dismissal. The claimant did not file a Motion to Correct, but filed a timely Petition for Review and Reasons for Appeal seeking to overturn the trial commissioner’s decision.
The claimant’s position is that penalties should be assessed against the Fund if the check from the stipulation settlement was not received by her within twenty days. She also argues that the Fund’s manner of delivering the settlement check was not reasonable as it was sent by ordinary mail, and it was not sent by certified mail. She further argues that if there was ambiguity in the terms of the settlement agreement as to the means of delivery of settlement proceeds, this ambiguity should be construed against the drafter of the agreement, which was the Fund. The Fund did not file a brief responsive to the claimant’s averment, deciding to rely on the commissioner’s Memorandum of Decision.
We note that the claimant did not file a Motion to Correct. As a result, pursuant to Corcoran v. Amgraph Packaging, Inc., 4819 CRB-2-04-6, 4948 CRB-2-05-5 (July 26, 2006) and Crochiere v. Enfield/Board of Education, 227 Conn. 333, 347 (1993), we must accept the validity of the facts found by the trial commissioner, and that this board is limited to reviewing how the commissioner applied the law. See Admin. Reg. § 31-301-4. “As with any discretionary action of the trial court, appellate review requires every reasonable presumption in favor of the action, and the ultimate issue for us is whether the trial court could have reasonably concluded as it did.” Daniels v. Alander, 268 Conn. 320, 330 (2004). We may intercede in those circumstances when we determine the trial commissioner has not properly applied the law to the facts in this case, Christensen v. H & L Plastics Co., Inc., 5171 CRB-3-06-12 (November 19, 2007).
The trial commissioner in this matter has submitted a very detailed explanation of his legal reasoning in this case. In large part, the commissioner justified his decision not to apply the statutory penalties under § 31-303 C.G.S., as based on our precedent in Garcia v. Middletown Nissan, 5035 CRB-8-05-12 (December 20, 2006). In Garcia, which was a case concerning whether penalties should be assessed for an allegedly late settlement payment, we made clear that when the parties reach an agreement as to the means and methods governing payment of a settlement, we will look to the terms of the agreement itself. We declined in Garcia to apply the Chairman’s Memorandum in effect at that time governing payment of settlement proceeds when the parties agreed to a payment agreement inconsistent with the Memorandum. Having obtained commission approval of the agreement, we look to its terms. The terms of the agreement were silent as to how checks were to be delivered to the claimant. We therefore look as to what were the reasonable expectations of the parties to the agreement.
The trial commissioner concluded the Fund initiated payment of the settlement within twenty days of approval of the stipulation. We note that in the Memorandum of Decision the trial commissioner distinguished our holding in Melillo v. Bayer Corp., 5490 CRB-3-09-8 (September 15, 2010) from the issues herein. We believe, however, that the Melillo case is supportive of the result herein. In Melillo we found that the issuance of a check for a settlement and its mailing to the claimant constituted a “payable” obligation against the respondent upon the date of mailing. As we pointed out in Melillo,
In the present matter it is undisputed that the respondents had issued a check to the claimant within the time period required under the stipulation. The moment such a check was issued, presuming it was drawn on sufficient funds, it was a payable obligation which could have been cashed or deposited immediately upon receipt. The claimant’s argument is while the check was issued, he did not receive it until it was delivered by the Postal Service.
The claimant admits that the Fund issued a check in a timely fashion, and mailed it to her in sufficient time that it should have arrived at her mailbox within the deadline stated in the agreement. Nonetheless, she argues that as the Fund failed to utilize certified mail, that they should bear the risk of loss for the Postal Service’s negligence. We stated in Garcia and Melillo that this commission will not add terms to agreements after the fact. Had the parties believed it was essential that the settlement checks be delivered in a more secure and timely manner than the ordinary mail; then the parties should have said so in the four corners of the agreement. The claimant admitted at oral argument before this tribunal that the much larger settlement check from Liberty Mutual was sent via ordinary mail and was received at her home in the ordinary course of business. We believe the trial commissioner reasonably concluded that the agreement was complied with when the Fund mailed the settlement check anticipating it would be received prior to the agreement’s deadline.3
The trial commissioner engaged in an extensive analysis of § 31-303 C.G.S. in the Memorandum of Decision. We agree with his conclusion that the legislative purpose behind the statute was to penalize parties that failed to pay obligations. The record herein documents that the Fund made extensive efforts to pay the obligation due the claimant in an expeditious manner. When the Fund became aware of the original check’s failure to arrive at the claimant’s address the record documents they made extensive efforts to remedy this situation and were fully transparent in their dealings with the claimant. As § 31-303 C.G.S. is a sanction statute akin to § 31-300 C.G.S. or § 31-288 C.G.S., we believe a commissioner should document a failure to act on the part of the respondent prior to levying sanctions. McFarland v. State/Dept. of Developmental Services, 115 Conn. App. 306 (2009). As the trial commissioner appropriately cites in his memorandum, Connecticut precedent such as Bittle v. Commissioner of Social Services, 249 Conn. 503, 515-516 (1999) does not impute the negligence of the Postal Service to the sender of mail.
It would be appropriate to sanction a respondent who negligently failed to make timely payment to the claimant. The trial commissioner herein found the respondent acted in a reasonable and non-dilatory manner and utilized reasonable means to forward payment to the claimant. Our statute does not support the imposition of sanctions in the absence of negligence on the part of the respondent. Based on the facts herein and the terms of the statute, we find the trial commissioner reached a reasonable decision consistent with the law. We affirm the Finding and Dismissal.
Commissioners Jodi Murray Gregg and Daniel E. Dilzer concur in this opinion.
1 We note that an extension of time and a postponement were granted during the pendency of this appeal. BACK TO TEXT
2 The relevant terms of this statute are as follows:
Sec. 31-303. Day when compensation payments become due. Penalty for late payments. Payments agreed to under a voluntary agreement shall commence on or before the twentieth day from the date of agreement. Payments due under an award shall commence on or before the twentieth day from the date of such award. Payments due from the Second Injury Fund shall be payable on or before the twentieth business day after receipt of a fully executed agreement. Any employer who fails to pay within the prescribed time limitations of this section shall pay a penalty for each late payment, in the amount of twenty percent of such payment, in addition to any other interest or penalty imposed pursuant to the provisions of this chapter. BACK TO TEXT
3 The claimant cites no statute mandating the use of certified mail for the delivery of settlement checks, and appears to be basing her argument solely on public policy grounds. BACK TO TEXT