Sea-Land Service, Inc. v. Barry
| Citation | 41 F.3d 903 |
| Decision Date | 07 December 1994 |
| Docket Number | No. 94-3026,SEA-LAND,94-3026 |
| Parties | , 30 Fed.R.Serv.3d 1513 SERVICE, INC., Petitioner, v. James BARRY and Director, Office of Workers' Compensation Programs, United States Department of Labor. |
| Court | United States Courts of Appeals. United States Court of Appeals (3rd Circuit) |
Keith L. Flicker (argued), Richard L. Garelick, Flicker, Garelick & Associates, New York City, for petitioner.
James R. Campbell, Eileen K. Campbell, New York City, for James Barry.
Thomas S. Williamson, Jr., Sol. of Labor, Carol A. De Deo, Associate Sol., Joshua T. Gillelan, II (argued), Sr. Atty., Office of the Sol., U.S. Dept. of Labor, Washington, DC, for the Director, OWCP.
Before: MANSMANN, COWEN and McKEE, Circuit Judges.
Sea-Land Service, Inc. seeks review of an order of the United States Department of Labor Benefits Review Board which affirmed the adverse decision of an Administrative Law Judge. The ALJ held that Sea-Land was liable for a twenty percent penalty on an overdue compensation award under Sec. 14(f) of the Longshore and Harbor Workers' Compensation Act, 33 U.S.C. Sec. 901, et seq. (1988) (the "Act" or the "LHWCA"). For the reasons that follow, we will deny the petition for review and affirm the decision of the Board.
James Barry filed an occupational disease claim for $4,090.51 against Sea-Land under the LHWCA. On January 2, 1991, Sea-Land's counsel submitted a stipulation memorializing the parties' settlement of Barry's claim to Administrative Law Judge Ralph A. Romano who was then presiding over the matter. The ALJ approved the terms of this settlement in an Order Approving Settlement which was filed in the office of the district director on Tuesday, January 15, 1991. On that same date the order was sent to the parties by certified mail.
On Friday, January 25, 1991, a copy of the ALJ's Order Approving Settlement was received in the office of Crawford & Company, Sea-Land's adjuster for workers' compensation claims. Crawford and Company made payment on Sea-Land's behalf in accordance with the terms of settlement by a check dated January 30, 1991. The check was probably mailed to Barry the same day. 1
Barry subsequently asserted that Sea-Land's payment had been untimely and petitioned the district director to assess a twenty percent penalty against Sea-Land under 33 U.S.C. Sec. 914(f) ("Sec. 14(f)" of the Act). 2 The district director granted the request and ordered Sea-Land to pay the additional twenty percent penalty, which amounted to $818.10. Sea-Land disputed Barry's entitlement to the penalty, and the matter was ultimately referred to the Office of Administrative Law Judges for a hearing. After conducting a formal hearing, ALJ Paul H. Teitler issued a decision and order on March 2, 1992, in which he ruled against Sea-Land and imposed the twenty percent penalty.
Sea-Land paid the penalty but appealed the ALJ's decision to the Board. On December 30, 1993, the Board affirmed the decision and order of ALJ Teitler and modified the award to reflect Barry's entitlement to interest on the late penalty payment. This appeal followed. We have jurisdiction under 33 U.S.C. Sec. 921(c).
We first address the Director's challenge to the Board's jurisdiction, and thus to our jurisdiction to review the Board's order. Section 921(b)(3) of the Act provides that "[t]he Board shall be authorized to hear and determine appeals raising a substantial question of law or fact taken by any party in interest from decisions with respect to claims of employees under this chapter...." Once the Board has rendered a decision, "[a]ny person adversely affected or aggrieved by a final order of the Board may obtain a review of that order in the United States court of appeals for the circuit in which the injury occurred...." 33 U.S.C. Sec. 921(c).
The Director contends that the order imposing a penalty under Sec. 14(f) is a "supplementary order declaring the amount of the default" under Sec. 18(a). Section 18(a) provides in part as follows:
In case of default by the employer in the payment of compensation due under any award of compensation ... the person to whom such compensation is payable may ... make application to the deputy commissioner making the compensation order [f]or a supplementary order declaring the amount of the default.... The applicant may file a certified copy of such supplementary order with the clerk of the Federal district court.... Such supplementary order of the deputy commissioner shall be final, and the court shall upon the filing of the copy enter judgment for the amount declared in default by the supplementary order.... Review of the judgment so entered may be had as in civil suits for damages at common law.
33 U.S.C. Sec. 918(a) (1988). The Director argues that such an order is enforceable in district court proceedings but that such enforcement is outside the review jurisdiction of the Board.
In essence, the Director maintains that payment under a Sec. 18(a) order without initiating enforcement proceedings in the district court constitutes a waiver of any objection to the validity of the Sec. 18(a) award. Thus, the Director urges that, rather than paying the Sec. 14(f) penalty, Sea-Land should have refused to pay and thereby compelled the Director to enforce the order in a district court enforcement proceeding. We disagree.
The Director's logic would require an employer to deliberately withhold payment to a claimant in order to force litigation in a district court. The claimant would then have to await the outcome of that litigation before receiving his or her payment. This result is inconsistent with the underlying compensatory philosophy of the Act. The LHWCA seeks to protect claimants and provide effective and expeditious compensation to those who are entitled to it. See Strachan Shipping Co. v. Hollis, 460 F.2d 1108, 1114 & n. 9 (1972).
It would be counterproductive for us to conclude that an employer who disagrees with a compensation order must withhold payment thereby forcing the claimant to initiate enforcement proceedings in order to have the validity of the award reviewed. The purpose of the Act is to place the compensation award in the hands of the entitled claimant as soon as possible. See id.; Arrow Stevedore Co. v. Pillsbury, 12 F.Supp. 920, 922 (N.D.Cal.1935); aff'd, 88 F.2d 446 (9th Cir.1937). The Act's provision regarding enforcement proceedings applies only "[i]f an[ ] employer ... fails to comply with a compensation order." 33 U.S.C. Sec. 921(d). The Act provides in relevant part as follows:
If any employer or his [or her] officers or agents fails to comply with a compensation order making an award, that has become final, any beneficiary of such award or the [district director] 3 making the order, may apply for the enforcement of the order to the Federal district court for the judicial district in which the injury occurred.
Id. (emphasis added). The decision of the district court can then be appealed to the appropriate court of appeals, thereby giving two levels of appeal. However, when an employer pays the Sec. 14(f) penalty in accordance with the objectives of the statute, but disputes the validity of that award, there is no need for an enforcement action in a district court, and the language of the statute does not provide for one in that instance.
Once the award has been paid, review is not available (and is not warranted) in a district court enforcement proceeding. Thus, we must conclude that Congress intended to provide that an aggrieved party could pay a penalty under Sec. 14(f) and then challenge the propriety of the assessment of that penalty in a proceeding brought before the Benefits Review Board. Section 921(c) then allows the aggrieved party to appeal the Board's decision to the appropriate court of appeals. Accordingly, the Board properly held that it had jurisdiction to decide this appeal from the decision of the ALJ.
The central issues in this case involve the application of the Federal Rules of Civil Procedure to the LHWCA. Rule 81(a)(6) provides that the Rules apply to "proceedings for enforcement or review of compensation orders" under the LHWCA (Secs. 18 and 21 of the Act). 4 Fed.R.Civ.P. 81(a)(6). That Rule is not, however, intended to extend the scope of the Rules beyond their intended application to "procedure in the United States district courts in all suits of a civil nature." Fed.R.Civ.P. 1. Payment of the award at issue here did not involve a "procedure in the United States district courts" and the Director therefore argues that the Rules do not apply to the computation of timeliness for such payment. However, we need not decide the issue of the general applicability of the Rules to the instant penalty assessment because, assuming arguendo that the Rules do apply, Sea-Land still cannot prevail.
Federal Rule of Civil Procedure 6(a) provides in pertinent part:
In computing any period of time prescribed ... by these rules ... the day of the act ... from which the designated period of time begins to run shall not be included. The last day of the period so computed shall be included, unless it is a Saturday, Sunday, or a legal holiday ... in which event the period runs until the end of the next day which is not one of the aforementioned days. When the period of time prescribed or allowed is less than 11 days, intermediate Saturdays, Sundays and legal holidays shall be excluded in the computation.
Rule 6(a) would require that five days be excluded from the computation of timeliness. 5 Accordingly, if Rule 6(a) applies, Sea-Land would have mailed payment on the tenth day. Sea-Land further asserts that it should be afforded an additional 3 days to pay Barry under Rule 6(e) and that its payment was, therefore, timely.
Rule 6(e) provides:
Whenever a party has the right or is required to do some act or take some proceedings within a prescribed period after the service...
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