Stickney v. Sunlight Construction, Inc.

The respondent employer and Commercial Union Insurance were represented by John T. Scully, Esq., Cooney, Scully & Dowling, Hartford Square North, 10 Columbus Blvd., Hartford, CT 06106.

The respondent employer and Aetna Casualty & Surety Co. were represented by Jason M. Dodge, Esq., Pomeranz, Drayton & Stabnick, 95 Glastonbury Blvd., Glastonbury, CT 06033.

This Petition for Review from the November 7, 1995 Findings of Facts and Award of the Commissioner acting for the Sixth District was heard September 20, 1996 before a Compensation Review Board panel consisting of the Commission Chairman Jesse M. Frankl and Commissioners George A. Waldron and Robin L. Wilson.

OPINION

JESSE M. FRANKL, CHAIRMAN. The respondent employer and its insurer, Commercial Union Insurance, have petitioned for review from the November 7, 1995 Findings of Facts and Award of the Commissioner acting for the Sixth District. They contend on appeal that the commissioner erred by granting the respondent Aetna Casualty & Surety’s Motion to Reopen and Modify Voluntary Agreement, which resulted in the substitution of Commercial Union for Aetna as the liable insurer in this claim. We affirm the trial commissioner’s decision.

The claimant suffered a compensable lumbar spine injury on or about February 7, 1985. Aetna had issued a workers’ compensation insurance policy covering the employer from April 11, 1984 to April 11, 1985, through Blumberg Associates, the employer’s insurance agency. According to a November 24, 1986 memorandum from the agent, Aetna had canceled its policy internally due to nonpayment of premium in 1984, prior to the claimant’s injury. However, it had not filed notice of cancellation with the Board of Compensation Commissioners pursuant to § 31-348 C.G.S.1 Subsequent to said cancellation, the employer quickly obtained replacement coverage with Commercial Union. A January 17, 1985 memorandum from the agent indicates that the new policy took effect on January 17, 1985. Although premiums were paid accordingly, proof of the replacement coverage was not provided to this Commission pursuant to § 31-348.

Because the first report of the claimant’s injury was done on an Aetna form, the agent mistakenly sent the form to Aetna, even though Commercial Union was now on the risk. Aetna issued a voluntary agreement accepting the claim, which was approved by a commissioner on June 2, 1986. In 1991, the claimant’s claim was reactivated when he had a recurrence of his symptoms. When the insurance adjuster for Aetna reviewed the computer records, she noted that the employer’s coverage had been canceled in December 1984, two months before the original injury. On October 26, 1992, Aetna moved to reopen the agreement and substitute Commercial Union as the insurer.2

The commissioner found that, despite Commercial Union’s contention that they were not responsible for any benefits paid to the claimant or reimbursement of over $50,000 spent by Aetna, Commercial Union had in fact paid some hospital bills on this claim. Commercial Union also argued that they were prejudiced by Aetna’s handling of the claim, because a potential third party action could have been brought against a third party tortfeasor. The commissioner concluded that Commercial Union was the insurer on the date of injury. He found that Aetna was not aware of Commercial Union’s coverage at that time, and that it properly administered and adjusted the claim in good faith, even though it had not received a premium. As Commercial Union had acknowledged its legal obligation on the claim by paying bills related to the 1991 recurrence of the injury, and had not offered any actual evidence of prejudice, the commissioner granted Aetna’s motion to open the voluntary agreement, and substituted Commercial Union as the insurer. Commercial Union has appealed that decision.

The appellant argues that Aetna’s motion to reopen did not meet the requirements of § 31-315 C.G.S., which governs motions to reopen an award in this forum. It further argues that Aetna filed the motion more than 7½ years after the claimant’s injury, which is such a long period of time that the claim for reimbursement should now be barred. Section 31-315 states:

The last sentence of § 31-315 provides an answer to one of the appellant’s claims: there is no set limit on the amount of time that may pass between the date of an injury or award and a motion to reopen that decision. Commissioners have continuing jurisdiction over compensation claims; the only relevant statute of limitation in this case was § 31-294, requiring the claimant to file his accidental injury claim within one year of the injury (which he did). Although equitable considerations such as negligence and prejudice certainly factor into a commissioner’s decision on whether to exercise his discretion to entertain a § 31-315 motion, there is no categorical time limit for filing. See Tutsky v. YMCA of Greenwich, 28 Conn. App. 536, 541 (1992).

In order to justify reopening the voluntary agreement in this case, Aetna needed to demonstrate to the trial commissioner that changed conditions of fact necessitated a modification of the agreement in order to carry out the spirit of the Act, and/or that a mistake had been committed in the original award that was not primarily due to Aetna’s own negligence. Section 31-315; Hayden v. Wallace & Sons Mfg. Co., 100 Conn. 180, 186 (1923); Tutsky, supra, 541. Here, it is apparent that the mistakes of several people combined to create this situation. The employer’s insurance agent mistakenly sent a report of the claimant’s injury to Aetna; Aetna failed to notify this Commission that it had ceased to insure the employer pursuant to § 31-348; Commercial Union failed to notify us that it had issued a workers’ compensation insurance policy covering the employer; and an Aetna employee authorized acceptance of this claim without recognizing that Aetna had canceled its policy effective prior to the date of injury.

Unlike the case cited by the appellant, Soares v. Glass Industries, 12 Conn. Workers’ Comp. Rev. Op. 189, 1377 CRB-3-92-1 (May 4, 1994), the party seeking to reopen the agreement here was not the only one who made an error. In fact, the insurer that should have paid the claimant’s benefits also made a mistake. Further, in Soares it was apparent that the appellant should have been alerted to the existence of a new injury several years before it raised the issue of mistake. Id., 192. The nature of Aetna’s mistake under these circumstances was not as readily discoverable.

The decision to open the voluntary agreement in this case was within the commissioner’s discretion, and we will overturn it only if that discretion was abused. Fazzina v. Shepard Steel, 14 Conn. Workers’ Comp. Rev. Op. 253, 254, 1831 CRB 1-93-9 (Aug. 31, 1995); Southard v. Southard Development, 13 Conn. Workers’ Comp. Rev. Op. 348, 350, 1891 CRB-4-93-11 (April 27, 1995). There was evidence that tended to show that the mistake and subsequent delay in reopening this case were not completely Aetna’s fault, and Commercial Union acknowledged that it was the workers’ compensation insurer on the risk at the time of the injury. It even paid benefits on the claimant’s behalf in 1991. The commissioner also noted with approval the conduct of Aetna in administering the claim in good faith. We believe that he had reasonable grounds upon which to conclude that the spirit of the Workers’ Compensation Act would be best served by granting the motion to modify the voluntary agreement, and we will not disturb the exercise of his discretion on review.

The trial commissioner’s decision is affirmed.

Commissioners George A. Waldron and Robin L. Wilson concur.

1 At that time, § 31-348 C.G.S. provided, “[e]very insurance company writing compensation insurance shall report in writing to the board of commissioners, in accordance with rules by them prescribed, the name of the person or corporation insured, including the state, the day on which the policy becomes effective and the date of its expiration, which report shall be made within one week from the date of the policy. The cancellation of any policy so written and reported shall not become effective until one week after notice of such cancellation has been filed with the commissioner or commissioners with whom such report is filed. Any insurance company violating any provision of this section shall be fined not less than one hundred nor more than one thousand dollars for each offense.” BACK TO TEXT

2 The commissioner initially ruled that he did not have jurisdiction over this dispute. On appeal, this board distinguished Piscitello v. Boscarello, 113 Conn. 128 (1931), ruling that it was permissible for an insurer to seek substitution of another insurer before this commission, even if the facts varied from the records required by § 31-348. Stickney v. Sunlight Construction Co., 12 Conn. Workers’ Comp. Rev. Op. 364, 1738 CRB-6-93-5 (Aug. 2, 1994). This case was then remanded to the trial commissioner for a determination of whether the voluntary agreement should be opened and whether Commercial Union’s equitable defenses were valid. Id., 368. BACK TO TEXT