In re Hopkins Fabrication, LLC
| Decision Date | 26 April 2022 |
| Docket Number | Case No. 3:20-cv-267 (CSH) |
| Citation | 600 F.Supp.3d 215 |
| Parties | IN RE: HOPKINS FABRICATION, LLC, Debtor. |
| Court | U.S. District Court — District of Connecticut |
George M. Purtill, Purtill & Pfeffer, P.C., South Glastonbury, CT, for Appellants Hopkins Fabrication, LLC and Donald Hopkins.
Kirk D. Tavtigian, Jr., Avon, CT, for Appellant Kirk D. Tavtigian, Esq.
Denise Mondell, State of Connecticut, Office of Attorney General, Hartford, CT, for Appellee Second Injury Fund.
U.S. Trustee Office, New Haven, CT, for U.S. Trustee.
Francis, O'Neil and DelPiano, Hartford, CT, for Interested Party: John J. O'Neil.
Jayme Stamper, Weiss & Stamper LLC, Danielson, CT, for Interested Party: Dawn Wilson.
Amity L. Arscott, Embry Neusner Arscott & Shafner, LLC, Groton, CT, for Interested Party: Cecilia Hawkins.
This is an appeal by the Debtor, Hopkins Fabrication, LLC ("Debtor Hopkins"), and two creditors, Donald Hopkins and Kirk D. Tavtigian, (collectively "Appellants") from two orders issued by Bankruptcy Judge Julie A. Manning ("Judge Manning") in an action (the "Bankruptcy Proceeding") before the United States Bankruptcy Court for the District of Connecticut (the "Bankruptcy Court"). The first order (the "February 7, 2020 Order Overruling Objection") issued on February 7, 2020. Doc. 1-1; see also In re Hopkins Fabrication, LLC , No. 18-21913, 2020 WL 609594, at *1 (Bankr. D. Conn. 2020). The second order (the "February 20, 2020 Order Denying Reconsideration"), which denied reconsideration of the February 7, 2020 Order Overruling Objection, issued on February 20, 2020. See Doc. 1-2.
The effect of these orders was to overrule Appellants’ objection to a proof of claim ("Proof of Claim") filed in the Bankruptcy Proceeding by the State of Connecticut, Second Injury Fund, Office of the Treasurer (the "Second Injury Fund" or the "SIF"), and to allow the SIF's claim as a general unsecured claim in the amount of $2,397,105.00. Doc. 1-1 at 5. In the Bankruptcy Proceeding, Appellants had objected to the Proof of Claim on the grounds that it was untimely filed and that the SIF failed to establish the validity and amount of its claim. The SIF, as Appellee, opposes the appeal and contends that the orders below should be affirmed.
On August 25, 2014, James A. Hawkins, III ("Hawkins") was killed during his employment at Debtor Hopkins, and "his death arose out of the course and scope of his employment." Doc. 5 ("Bankruptcy Proceeding Docket"), Doc. 76-1 at 3. At the time of the incident, Debtor Hopkins "did not have workers’ compensation insurance coverage and was not deemed ... self-insured pursuant to the Workers’ Compensation Act, Chapter 568." Doc. 10-1 at A-92. Also, at the time of Hawkins's death, "he was married to Dawn Wilson and was supporting ... two minor children, Anastasia Hawkins and Cecilia Hawkins. Bankruptcy Proceeding Docket, Doc. 76-1 at 3.
Accordingly, on May 13, 2015, the State of Connecticut Workers’ Compensation Commission (the "Workers’ Compensation Commission") ordered that Debtor Hopkins "pay weekly benefits separately in equal shares with annual cost of living adjustments to Dawn Wilson and Anastasia Hawkins ... and Cecilia Hawkins." Id. at 5; see also Doc. 10-1 at A-92. In this order (the "May 13, 2015 Workers’ Compensation Commission Order"), the Workers’ Compensation Commission determined that, at the time of Hawkins's death, his "average weekly wage was $1,626.88 with a resulting compensation rate of $950.29." Bankruptcy Proceeding Docket, Doc. 76-1 at 3.
The May 13, 2015 Workers’ Compensation Commission Order made several other pertinent findings. First, it noted that Debtor Hopkins must "pay annual cost of living adjustments pursuant to [Connecticut General Statutes] Section 31-307 beginning with each October 1st after [Hawkins's] death." Id. at 4. Second, it stated that, "[p]ursuant to [Connecticut General Statutes] Section 31-306(5), Id. Third, it found that "[w]hen either [of] the two minor children" cease to be eligible for benefits, "such child's share shall be divided among the remaining eligible dependents." Id. Fourth, "[i]n the event that Dawn Wilson's eligibility ceases, then her share shall be equally divided among the remaining eligible dependents as previously described." Id. Under Connecticut General Statutes § 31-306(3), "[i]f the surviving spouse is the sole presumptive dependent, compensation shall be paid until death or remarriage."
Pursuant to the May 13, 2015 Workers’ Compensation Commission Order, Debtor Hopkins paid Hawkins's dependents "in accordance with [Connecticut General Statutes] § 31-306(4) subject to any annual cost of living adjustments pursuant to [Connecticut General Statutes] § 31-307 beginning with each October 1st after [Hawkins's] death." Doc. 10-1 at A-92. On June 13, 2018, a "subsequent Agreement Regarding Eligibility for Benefits was approved and ordered ... modifying the distribution to eliminate payment to Anastasia Hawkins, who was emancipated, and altered the division of the death benefit payments to fifty percent to Cecilia Hawkins and fifty percent to Dawn Wilson." Bankruptcy Proceeding Docket, Doc. 76 at 3. The Court will refer collectively to Cecilia Hawkins and Dawn Wilson as the "Hawkins Dependents."
On November 26, 2018 (the "Petition Date"), Debtor Hopkins filed a voluntary petition for bankruptcy under Chapter 7 of the U.S. Bankruptcy Code ("Chapter 7"). This filing commenced the Bankruptcy Proceeding, which was assigned to Bankruptcy Judge James J. Tancredi ("Judge Tancredi"). On December 21, 2018, Debtor Hopkins filed a "Declaration Under Penalty of Perjury for Non-Individual Debtors." Bankruptcy Proceeding Docket, Doc. 13 at 1.
Included with this filing was a schedule of unsecured creditors entitled "Schedule E/F: Creditors Who Have Unsecured Claims" ("Schedule"). Id. at 12. Part two of this Schedule is a list of all creditors with nonpriority unsecured claims. Id. at 13. Among several other creditors, this list contains: "Anastasia Hawkins," "Cec[i]lia Hawkins," "CT Second Injury Fund," "Dawn Wilson," and "Dawn Wilson, Administrator." Id. at 13-14. The claim of each of these creditors is listed as "contingent," "unliquidated," and "disputed." Id. The amount of the claim to each of Anastasia Hawkins, Cecilia Hawkins, Dawn Wilson, and "Dawn Wilson, Administrator" is listed as $0.00. Id. The amount of the claim to the "CT Second Injury Fund" is listed as "Unknown." Id. at 14.
On December 26, 2018, the Bankruptcy Court set a deadline of February 4, 2019 (the "General Bar Date") for all creditors to file proofs of claim, except for "governmental units" within the meaning of 11 U.S.C. § 101(27). Doc. 1-1 at 1. The deadline for governmental units to file proofs of claim was set at the date "within 180 days of entry of the Order for Relief," which, if calculated from the [Petition Date], was May 25, 2019" (the "Governmental Unit Bar Date"). Id.
On December 11, 2018, Debtor Hopkins ceased making payments to Cecilia Hawkins. Doc. 10-1 at A-90, A-94. On April 23, 2019, Debtor Hopkins ceased making payments to Dawn Wilson. Id. When an employer is unable to pay the benefits ordered by the Workers’ Compensation Commission, Connecticut law requires that such benefits be paid by the Second Injury Fund. Connecticut General Statutes § 3l-355(b) provides, in relevant part, that:
When an award of compensation has been made under the provisions of this chapter against an employer who failed, neglected, refused or is unable to pay any type of benefit coming due as a consequence of such award or any adjustment in compensation required by this chapter ... such compensation shall be paid from the Second Injury Fund. The administrative law judge, on a finding of failure or inability to pay compensation, shall give notice to the Treasurer of the award, directing the Treasurer to make payment from the [Second Injury Fund].
Since Connecticut General Statutes § 3l-355(b) is a provision of the Workers’ Compensation Act, Chapter 568 ("Workers’ Compensation Act"), the Court interprets the term "this chapter" to refer to the Workers’ Compensation Act. In the May 13, 2015 Workers’ Compensation Commission Order, the Workers’ Compensation Commission explicitly noted that Hawkins's claim against Debtor Hopkins "falls within the jurisdiction of the Connecticut Workers’ Compensation Act." Bankruptcy Proceeding Docket, Doc. 76-1 at 3.
Therefore, pursuant to Connecticut General Statutes § 3l-355(b), the SIF's obligation to make payments to the Hawkins Dependents is contingent upon two determinations by an administrative law judge ("ALJ"). Specifically, an ALJ must (1) find that Debtor Hopkins has failed or is unable to pay the Hawkins Dependents pursuant to the May 13, 2015 Workers’ Compensation Commission Order; and (2) direct the Treasurer to make payment from the Second Injury Fund. Until an ALJ makes these two determinations, the SIF is not responsible for payments to the Hawkins Dependents. The Court will refer to these two determinations as the "Entry of a Finding and Award Pursuant to Connecticut General Statutes § 31-355(b)."
Moreover, after the Entry of a Finding and Award Pursuant to Connecticut General Statutes § 31-355(b), which obligates the SIF to pay the Hawkins Dependents, the SIF becomes entitled to indemnification from Debtor Hopkins. Connecticut General Statutes § 31-355(c) states:
The employer ... shall be liable to the state for any payments made out of the...
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