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CASE NO. 5579 CRB-5-10-7
COMPENSATION REVIEW BOARD
WORKERS’ COMPENSATION COMMISSION
JUNE 28, 2011
SALVATORE P. LANTIERI, (Deceased) and LENA LANTIERI, Dependent Widow of Salvatore Lantieri
ANACONDA AMERICAN BRASS COMPANY
TRAVELERS PROPERTY & CASUALTY
ESIS NEW ENGLAND
SECOND INJURY FUND
The claimant was represented by Christopher Meisenkothen, Esq., Early, Ludwick & Sweeney, 265 Church Street, Eleventh Floor, P.O. Box 1866, New Haven, CT 06508, who did not submit a brief or appear at oral argument as the underlying issues on appeal did not involve the claimant.
The respondents-appellants, Anaconda American Brass Company and Travelers Property and Casualty, were represented by Maribeth M. McGloin, Esq., Maher & Williams, P.O. Box 550, Fairfield, CT 06824.
The respondents-appellees, British Petroleum and ESIS New England, were represented by Lucas Strunk, Esq., Pomeranz, Drayton & Stabnick, 95 Glastonbury Boulevard, Glastonbury, CT 06033.
The Second Injury Fund was represented by Jennifer S. Janik, Esq., Assistant Attorney General, Office of the Attorney General, 55 Elm Street, P.O. Box 120, Hartford, CT 06141-0120, who did not appear at oral argument.
This Petition for Review from the July 16, 2010 Finding and Award of the Commissioner acting for the First District was heard January 21, 2011 before a Compensation Review Board panel consisting of the Commission Chairman John A. Mastropietro and Commissioners Scott A. Barton and Christine L. Engel.
JOHN A. MASTROPIETRO, CHAIRMAN. This appeal concerns the applicability of § 31-299b C.G.S. to a self-insured employer. The appellant in this matter, Travelers Property Casualty, (“Travelers”) was the insurer over this claim during certain periods of time where the claimant was exposed to a compensable occupational disease. They have paid a Finding and Award to the clamant as lead carrier for this claim, and seek to have the respondent Anaconda American Brass Company (“Anaconda”) and its successor corporate owners and insurer, British Petroleum and ESIS New England. Inc., contribute to the payment via reapportionment. Anaconda maintains it was a self-insured employer and therefore exempt from reapportionment. The trial commissioner agreed with Anaconda’s position and denied Travelers’ bid to have Anaconda pay a share of the award. Travelers has appealed this decision. We find the trial commissioner’s decision was entirely consistent with precedent in Esposito v. Simkins Industries, Inc., 5065 CRB-3-06-3 (March 1, 2007), aff’d, 286 Conn. 319 (2008). We affirm the Finding and Award and dismiss this appeal.
The following facts are pertinent to our consideration of this appeal. The claimant worked for Anaconda for 31.5 years and died of lung carcinoma on March 15, 1994, less than one year after having been diagnosed with this condition. Travelers acknowledged it was the lead carrier on the claim for § 31-299b C.G.S. purposes and also acknowledged it was the carrier on the claim for 1.5 years, or 4.8 percent of the 31.5 years the claimant was exposed to carcinogens. Anaconda was insured for its workers’ compensation liability by the now defunct American Mutual Insurance Company for 15 years, or 47.6 percent of the 31.5 years. The Connecticut Insurance Guaranty Association (“CIGA”) has assumed those liabilities due to American Mutual’s insolvency.1 Anaconda was self-insured for 15 years of the claimant’s exposure, representing 47.6 percent of the claim. As noted, Anaconda was purchased by British Petroleum which has assumed the liabilities of Anaconda during its self-insurance period.
The trial commissioner went through an accounting of how the claim has been paid to date, with the surviving widow continuing to receive benefits, including cost-of-living adjustments. The Second Injury Fund has been responsible for the COLA’s on this claim, but the trial commissioner determined that after COLA’s a remaining amount of $303,285.97 as of October 28, 2008 was to have been paid by Travelers and subject to statutory apportionment. Travelers cited Hunnihan v. Mattatuck Mfg. Co., 243 Conn. 438 (1997) and Konovaluk v. Graphite Die Mold, Inc., 4437 CRB-3-01-9 (August 8, 2002) as authority for its position it may reapportion liability against Anaconda as a self-insured entity. Anaconda cited those cases as well as Esposito, supra, and Doucette v. Pomes, 247 Conn. 442 (1999) for the opposite conclusion. that as a self-insurer it was exempt from reapportionment. Based on these facts, the trial commissioner concluded “that, based upon the facts as stipulated by the parties and the applicable case law, the Respondent Self-Insured share of liability may not be increased and is limited to 47.5 percent of benefits paid to the Claimant.” Conclusion, ¶ N.2
Travelers filed a Motion to Correct seeking to correct a scriveners error in the Finding and Award, as well as to substitute findings that it was permitted to obtain reapportionment against Anaconda, thus establishing liability for 90.9% of the claim against Anaconda. This Motion was denied in its entirety. The appellants have pursued this appeal, focused primarily on their view that the trial commissioner failed to properly apply the precedent in Hunnihan, supra, and Konovaluk, supra.
Travelers rests its argument on the precedent in Konovaluk and the terms of the statute. As Travelers states on page 7 of their brief, “Section 31-299b allows for reimbursement from ‘prior employers, or their insurers’ (Emphasis added.. The statute does not limit reimbursement to insurance companies and does not treat self-insured employers and insurance companies differently.” However, we do not agree with Travelers that Konovaluk endorses their position. In fact in that opinion we considered and rejected many of the arguments advanced in the present appeal.
In Konovaluk it appears both parties advanced arguments that would cause the self-insured employer to bear a share of the costs. This tribunal explained why it chose not to adopt those positions. While relying on other portions of our opinion, Travelers did not cite footnote, ¶ 2 of the Konovaluk decision in its brief, which states, in part:
“We disagree with the appellants’ assertion that, following our Supreme Court’s decision in Hunnihan, the claimant’s award might possibly be diminished to the extent that an insolvent insurer was involved in a case, or alternatively, that the employer (in this case, CMS Graphite) would be held responsible for the percentage of liability attributable to the now-defunct insurance carrier.” (Emphasis added)
In the body of the Konovaluk decision this board also specifically expressed dismay at the arguments of the appellee which sought to place added burdens on the self-insured, noting that this might well lead to an inequitable burden on the employer.
We would also posit that this approach would not be likely to avail an employer that recently became self-insured. Such an entity could end up accepting liability for a number of long-term occupational disease claims without being able to say that a roughly equal number of exposures from its own past, for which it would otherwise be liable, have been assigned to another carrier via § 31-299b. In fact, the pool of claims for many self-insureds would not be large enough to realistically expect any sort of a “balancing out” of gains and losses. Id.
We agree with Travelers our Konovaluk opinion states “we rule that § 31-299b allows the last insurer on the risk at the time of substantial exposure in an occupational disease or repetitive trauma case to seek reimbursement from all other solvent insurers or self-insured employers not only for the proportional shares of benefits attributable to their periods of coverage, but also for a similarly proportional share of any benefits that were due from an employer whose insurer has been declared insolvent and is therefore unable to remit reimbursement.” Id. However, given the other holdings in the Konovaluk opinion, we do not believe we can rely on the language cited by Travelers, particularly as this case was decided in 2002 and we are bound by more recent appellate precedent.
Travelers may argue that the “plain meaning” of § 31-299b C.G.S. does not differentiate between insurers and employers. However, we also note when courts have previously interpreted a statute that appellate precedent serves to limit reliance on the “plain meaning” of statutes as directed by § 1-2z C.G.S. See Hummel v. Marten Transport, LTD, 282 Conn. 477 (2007). As a result, we look to how the Supreme Court considered the apportionment issue in Esposito, supra.
In Esposito, the Supreme Court upheld this board’s decision which found that a self-insured entity should be treated differently than insurers for the purposes of § 31-299b C.G.S. liability. Our decision in Esposito cited Doucette, supra, and Connecticut Ins. Guaranty Assn. v. State, 278 Conn. 77 (2006) (“CIGA v. State”) as both standing for the proposition that self-insured entities were not the functional equivalent of “insurers” for the purposes of reapportionment. Since the self-insured employer in CIGA v. State was permitted to make a claim under circumstances where an insurer would be barred, we concluded that in Esposito, the self-insured employer could seek to apportion the share of the claim attributable to an insolvent insurer and seek reimbursement from CIGA. In their opinion, the Supreme Court clearly rejected an argument by CIGA that § 31-299b C.G.S. apportionment was not governed by the precedent in Doucette, supra. Esposito, supra at 338-339.
A common theme in the various cases citing Doucette such as Esposito and CIGA v. State is that solvent insurers should be expected to absorb responsibility when another insurer becomes insolvent, but that self-insured parties and claimant should not bear the same burden. We have consistently held that while § 31-299b C.G.S. and the statutes governing CIGA do not act to protect solvent insurers from insurer insolvency, Christensen v. H & L Plastics Co., Inc., 5171 CRB-3-06-12 (November 19, 2007), these statutes are intended to protect consumers Hunnihan, supra at 451-453. Clearly our Supreme Court views an employer who obtains workers’ compensation insurance as a form of consumer. See CIGA v. State, supra at 85-87.
Travelers notes that in footnote, ¶ 14 of the Supreme Court’s Esposito opinion the court expressed no opinion on the holding of Konovaluk. In the opinion of Travelers, this footnote endorses its position in favor of apportionment against Anaconda. We do not agree as the same footnote also noted that this board had distinguished between insurers and self-insurers in applying the precedent in Konovaluk. As we previously noted, Konovaluk itself speaks to the issue of shielding self-insurers from an inequitable share of reapportioned claim expense.
Anaconda echoes these concerns in a public policy argument they briefed. They note that they paid insurance premiums to American Mutual for 15 years and now, based on the position of Travelers, should pay a claim themselves for a period during which they had already paid for insurance coverage. This, in Anaconda’s opinion would shift the risk of insurer insolvency back on the insured party and would be inequitable and inconsistent with precedent. Appellee’s Brief, p. 5. We note that Travelers’ Motion to Correct sought to place 90.9% of the share of the claimant’s award on Anaconda. See Correction, ¶ 5. Again, this appears to contravene the intent of Konovaluk and Hunnihan that “the risk of insurer insolvency has been placed on the insurance industry as a whole.” Hunnihan, supra, 452.
In Konovaluk this board determined that “Section 31-299b, therefore, is primarily designed to protect the interest of claimants, but it was consciously constructed to also allow for an ultimate distribution of liability that would not place an undue burden on the last insurer on the risk.” As Travelers interprets § 31-299b C.G.S. they seek to place an undue burden not on another insurer, but on a self-insured employer. Given the lengthy recent precedent where this board and the Supreme Court have distinguished between the rights of self-insured parties and insurers, we agree with the trial commissioner that the construction of the statute sought by Travelers is untenable.
We find no support in precedent such as Esposito for the proposition that a self-insured employer should be subject to reapportionment of the obligations of an insolvent insurer. We affirm the trial commissioner’s Finding and Award and dismiss this appeal.
Commissioners Scott A. Barton and Christine L. Engel concur in this opinion.
1 CIGA is not a party to this appeal, having advised the tribunal on August 27, 2010 they were not participating in this matter. The Second Injury Fund has been involved in this claim by virtue of reimbursement of cost-of-living allowances. While they filed an appearance on August 10, 2010, they filed a brief in this appeal indicating they had no position on the issues herein and did not appear at oral argument. BACK TO TEXT
2 Anaconda has conceded responsibility for 47.6% of liability for this claim and not 47.5%, see Footnote, ¶ 1, Appellee’s Brief p. 6. As a result, we correct the record to reflect that percentage wherever it appears in the Finding and Award. BACK TO TEXT
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