Hartford Acc. & Indem. Co. v. Duvall

• Decision Date: 31 January 1973
• Docket Number: No. 6399,6399
• Citation: Hartford Acc. & Indem. Co. v. Duvall, 300 A.2d 732, 113 N.H. 28 (N.H. 1973)
• Parties: HARTFORD ACCIDENT & INDEMNITY CO. and American Mutual Liability Ins. Co. v. Robert M. DUVALL, Labor Commissioner.
• Court: New Hampshire Supreme Court

Page 732

300 A.2d 732

113 N.H. 28

HARTFORD ACCIDENT & INDEMNITY CO. and American Mutual Liability Ins. Co. v. Robert M. DUVALL, Labor Commissioner.

No. 6399.

Supreme Court of New Hampshire.

Jan. 31, 1973.

Wadleigh, Starr, Peters, Dunn & Kohls and Eugene M. VanLoan, III, Manchester (Charles J. Dunn, Manchester, orally), for plaintiffs.

Warren B. Rudman, Atty. Gen., and Richard F. Therrien, Allenstown, Atty. (Richard F. Therrien, Allenstown, orally), for defendant.

DUNCAN, Justice.

By this petition for declaratory judgment, two carriers of workmen's compensation insurance seek a determination that RSA 281:37 II (Supp.1972) which was inserted in the Workmen's Compensation Law by Laws 1971, 539:8, is unconstitutional as applied by the labor commissioner to claims for compensation arising both before and after the effective date of the amendment. In particular it is alleged that imposition of the statutory penalty upon an employer for failure to pay compensation as awarded by the commissioner, pending an appeal of the decision to the superior court, violates articles 14, 23, and 37 of part I of the New Hampshire constitution and the fourteenth amendment to the Constitution of the United States. The issues presented by the parties' agreed statement of facts were reserved and transferred without ruling by Flynn, J.

The subsection which gives rise to the action is as follows: 'II. A decision of the labor commissioner shall take effect upon date of notification and become final, in the absence of an appeal therefrom, thirty days thereafter. Payment of weekly compensation shall begin and/or continue as soon as possible after the decision's effective date, but no later than five work days thereafter, and shall not be terminated, except in accordance with the terms of the commissioner's decision or by final court determination. Upon failure of an employer, or his insurance carrier, so to comply with his decision, the commissioner shall assess a penalty not to exceed twenty-five dollars for each day of non-compliance, beginning on the date of notification of assessment. Upon continued failure to comply with an order to make payment of compensation and/or penalty, the commissioner shall petition the superior court for an injunction to comply. All penalties collected under this section shall be deposited by the commissioner with the state treasurer.' RSA 281:37 II (Supp.1972).

The plaintiffs contend that the legislature did not intend the amendment to apply to claims which arose prior to its enactment, but that if it did so intend, the statute violates article 23 of part I of the New Hampshire constitution because retrospective. They further contend that if not retrospective, the statute violates their constitutional rights because it makes no provision for recoupment by the employer in the event that the appeal is successful; and finally that if a right of recoupment is implied, the right would be unenforceable and hence ineffective, all in violation of the right to a legal remedy guaranteed by article 14, the right to equal protection of the law and the right not to be deprived of property without due process of law, guaranteed by article 15, part I of the New Hampshire constitution, and the fourteenth amendment.

The latter contention is based upon the assertion that a hearing before the commissioner does not afford employers a right of cross-examination, but is 'summary, informal, and not limited by any rules of evidence'. See RSA 281:41 (Supp.1972).

We hold the statutory provisions to be constitutional. First, we hold that RSA 281:37 II (Supp.1972) does not violate article 23, part I of the New Hampshire constitution. Its application by the commissioner has been wholly prospective, since it has been applied only to appeals taken after the effective date of the amendment. The provision requires that payment of compensation awarded following notice and hearing, shall commence no later than five days after notice of the commissioner's decision. The fact that such compensation may be for injuries suffered prior to passage of the amendment has no relevance to the determination of retroactivity. The requirement of payment and the duty to make it does not come into being until after the commissioner has found the employee entitled thereto. No penalty is assessed unless and until the employer fails to pay in accordance with the decision, whether an appeal is taken or not. In this no retrospection is involved. Cf. Hirsch v. Company, 97 N.H. 480, 486, 92 A.2d 402, 405-406 (1952); Opinion of the Justices, 99 N.H. 509, 112 A.2d 48 (1955). Moreover since the requirement of the statute affects the remedy only, it will not conflict with article 23, part I of the constitution provided it is not oppressive or unjust. Pepin v. Beaulieu, 102 N.H. 84, 89-90, 151 A.2d 230, 235 (1959).

Secondly, we agree that the statute makes no provision for recoupment of payments made, in the event that the decision of the commissioner is overturned on appeal. We hold that no such right of recoupment was implied or intended. See Hagerty v. Great Am. Ind. Co., 106 N.H. 425, 213 A.2d 424 (1965). The absence of provision therefor is to us an indication of the legislative intent that no such right should arise.

It has long been established that workmen's compensation is remedial in character, designed to provide, in substitution for unsatisfactory common-law remedies in tort, a liability without fault for limited compensation, capable of ready and early determination. Mulhall v. Company, 80 N.H. 194, 196-199, 115 A. 449, 453 (1921); see Carbonneau v. Company, 96 N.H. 240, 244, 73 A.2d 802, 806 (1950). The provisions of the 1971 amendment were designed to further this purpose, and to assure prompt payment of compensation to workmen found to be entitled thereto, after administrative hearing of the parties involved.

Granted that in the event of successful appeals by employers, the statute will place upon them a new or additional burden. The legislature could reasonably find that the withholding of compensation by employers pending appeal had operated to frustrate the purposes of the law. Hence in the exercise of the police power, it could properly require employers, and more broadly the enterprises which they represent, to bear for a limited period the risk of payments made during appeal, rather than the injured employee, who as the plaintiffs point out is usually in no financial position to carry that risk. Merchants Mut. Ins. Co. v. Newport Hosp., 108 R.I. 86, 272 A.2d 329 (1971); St. Paul Fire & Marine Ins. Co. v. Treadwell, 263 Md. 430, 283 A.2d 601 (1971).

The argument that the plaintiffs are deprived of the equal protection of the law stems from other provisions contained in Laws 1971, ch. 539, which amended the unemployment compensation law (RSA ch. compensation law ...