Lee Way Motor Freight, Inc. v. Welch

• Decision Date: 01 November 1988
• Docket Number: No. 63900,63900
• Citation: 764 P.2d 191
• Parties: LEE WAY MOTOR FREIGHT, INC., and PepsiCo, Inc., Petitioners, v. Loyd E. WELCH, Claimant-Respondent.
• Court: Oklahoma Supreme Court

Page 191

764 P.2d 191

1988 OK 121

LEE WAY MOTOR FREIGHT, INC., and PepsiCo, Inc., Petitioners, v. Loyd E. WELCH, Claimant-Respondent.

No. 63900.

Supreme Court of Oklahoma.

Nov. 1, 1988.

Proceeding to review a decision by an Appellate Panel of the Workers' Compensation Court.

A proceeding by guarantor of employer's compensation liability to review a Workers' Compensation Court order by Clint G. Livingston, Judge--affirmed by an appellate panel of Judges Ryan, Cox and Seagle--which certifies an unpaid portion of the award whose monetary amount is uncertain for enforcement in the district court against both the bankrupt self-insured employer and its guarantor as co-obligors of the award.

ORDER CERTIFYING AWARD SUSTAINED IN PART AND MOTION FOR CERTIFICATION REMANDED FOR ADDITIONAL FINDINGS.

Albert M. Morrison, Kenneth N. McKinney, Robert L. Roark, McKinney, Stringer & Webster, and Charles C. Green, Turner, Turner, Green & Braun, Oklahoma City, and White & Case, New York City, and Schiff, Hardin & Waite, Chicago, Ill., for petitioner, PepsiCo, Inc.

Lew Gravitt, Stipe, Gossett, Stipe, Harper, Estes, McCune & Parks, Oklahoma City, for claimant-respondent.

OPALA, Justice.

Three questions are tendered for our review: Does the out-of-state parent company's guaranty for its local subsidiary--a device necessary to assure the latter entity's continued status as an Oklahoma own-risk employer--make the guarantor liable for payment of benefits awarded before the effective date of the guaranty, where the employer's default in payment occurred after the guaranty's revocation? Did the Workers' Compensation Court err by including the guarantor--qua co-obligor with the now bankrupt own-risk subsidiary who was the employer--as an additional party codebtor in the order certifying the obligation for enforcement in the district Loyd E. Welch [claimant], an employee of Lee Way Motor Freight, Inc. [Lee Way or employer], suffered an on-the-job injury on May 15, 1983 when the truck in which he was a passenger was involved in a collision. Lee Way, then a subsidiary of PepsiCo, Inc. [PepsiCo or guarantor], was an Oklahoma own-risk employer. By its January 3, 1984 award the Workers' Compensation Court allowed claimant compensation for temporary total and permanent partial disability totaling $16,905, less special indemnity fund tax of $338.10 and counsel fees of $3,381. This order was later affirmed by a three-judge review panel.

                court?   and  Is an order of the Workers' Compensation Court certifying an unpaid award for entry on the judgment docket required to specify the unpaid amount of the award in default?   Following the teachings of Lum v. Lee Way Motor Freight, Inc., 1 we answer the first question in the affirmative and the second in the negative.  To the third question we also respond in the affirmative
                

Claimant received all the temporary total disability that was due him; permanent partial disability payments continued until October 15, 1984 when Lee Way ceased all remittances of benefits. Upon claimant's motion, the trial tribunal certified on February 15, 1985 the unpaid balance to the district court in accordance with the terms of 85 O.S.Supp. 1983 § 42 ² and Rule 28 of the Workers' Compensation Court. ³ In that order the trial judge neither reduced to a lump sum nor made a finding with respect to the specific amount of the unpaid balance then due on the January 3, 1984 award in default. PepsiCo, the guarantor, who was included in the certification order as an additional party obligor, brought the instant proceeding for corrective relief.

Claimant relies on PepsiCo's guaranty for the employer-subsidiary as the basis for its liability on the award in contest. That guaranty, accepted by the Workers' Compensation Court on July 27, 1984, was revoked by PepsiCo on August 29, 1984. It was hence filed below after claimant had secured the award whose portion came to be certified and was revoked before Lee Way ceased to meet that adjudicated obligation. The general principles of law which govern the enforceability of PepsiCo's guaranty are stated in Lum v. Lee Way Motor Freight, Inc. ⁴ They apply with equal force to this award and conclusively support the propriety of PepsiCo's inclusion in the certification order as guarantor of Lee Way's compensation liability. ⁵

The remaining issue for review is whether the Workers' Compensation Court must certify to the district court a specific amount of the unpaid award there to be enforced. We hold that in this respect the order under review is fraught with two facial infirmities--(1) the finding that Lee Way was in default is ambiguous and indefinite and (2) because the certified order has not reduced the award's unpaid portion to a specific sum, the order cannot be treated as a district court judgment.

I THE TRIAL TRIBUNAL'S FINDING OF DEFAULT IS TOO VAGUE AND INDEFINITE

The trial court's order certifying the unpaid award of permanent partial disability for execution and enforcement in the district court rests on its finding that:

"2. ... since entering said Order, Respondent has failed to comply herewith in accordance with said Order."

The quoted language is too vague and indefinite for judicial interpretation. One cannot determine from a four-corners' examination of the quoted text when and in what manner Lee Way had defaulted on its adjudicated compensation obligation. An order based on an ambiguous finding is subject to vacation for further proceedings. ⁶

II

THE CERTIFICATION ORDER DID NOT, AS REQUIRED BY LAW, CLOTHE

THE UNPAID AWARD WITH THE ATTRIBUTES OF AN

ENFORCEABLE DISTRICT COURT JUDGMENT

The Workers' Compensation Act provides the remedies available to claimants when their employers or the latters' insurers violate the Act's provisions. The terms of 85 O.S. 1981 § 41 ⁷ and 85 O.S.Supp. 1983 § 42 ⁸ prescribe the procedure to be followed upon the obligor's failure to pay compensation due under the terms of an award. An employer's or insurance carrier's ten-day default in payment of a compensation award effects a statutory acceleration of the unpaid adjudicated obligation ⁹ and the unaccrued installments are at once commuted to a lump sum, thus making the entire unsatisfied obligation immediately due. ¹⁰

Upon finding an obligor in default of payment, the Workers' Compensation Court may certify the award's unpaid amount and direct that a copy of its certification order be filed in the offices of any When filed in the district court, the certification affords a legal vehicle for enforcement proceedings to be conducted in that forum. Section 42 provides that when the certified award is entered on the judgment docket, ¹¹ execution and other process shall issue in the same manner as for district court judgments. ¹²

county clerk and court clerk, as well as be entered there on the judgment docket. A certified unpaid award that has been so reduced to a fixed amount and filed in the district court acquires by force of statute the efficacy of a district court judgment. In short, certification is the statutory procedure for transforming an unpaid award in default into an enforceable district court adjudication by clothing the obligor's compensation liability with the attributes of a district court judgment.

A writ of execution is issued by the court clerk and directed to the sheriff for levy. ¹³ Execution cannot issue if the judgment is ambiguous or uncertain in amount. ¹⁴ In sum, because in the absence of a fixed amount of the adjudicated obligation appearing on its face no judgment can exist in contemplation of law, ¹⁵ a certification order must be clothed with the same attributes of certainty as those which are necessary to support execution or other enforcement process upon a district court judgment.

At the certification hearing below claimant's counsel informed the trial tribunal of the amount that had been paid for permanent partial disability and of the balance that remained unpaid. Lee Way's counsel had no reason to dispute the figures given to the court. The trial judge nonetheless refused to make a finding of the total amount of unpaid award in default, stating that the district court would be the proper forum to effect that determination. ¹⁶ To give the certified award the force and efficacy of a district court judgment, the trial judge was duty-bound to find the amount that was due and unpaid under the award in default. Although the transcript of the certification hearing reflects undisputed testimony as to the unpaid amount, there is nothing upon the face of the certification order that gives it the quality of a judgment for a sum certain. No legal assessment of an order's sufficiency may be made on the basis of a transcript, because it is the order alone which is placed of record in the county clerk's office and on the district court's judgment docket. ¹⁷ In short, the award's unpaid amount must always be ascertainable from a four-corners' examination of the certified award.

¹⁶

SUMMARY

The certification order under review does not meet the sine qua non standard of definiteness. The trial tribunal correctly ruled that the claimant in this case could invoke the guarantor's secondary liability for Lee Way's compensation obligation in existence when the guaranty was accepted. Lee Way was properly included in the certification order for district court enforcement. Since Lee Way--the employer--was then in bankruptcy and its obligation to pay the award stood suspended by force of federal law, the guarantor was the only obligor against whom execution could issue. The certification of the unpaid award for execution and enforcement is facially infirm because (a) the trial tribunal's finding that Lee Way was not in "compliance" was too vague and ambiguous to establish its default and (b) the certification order's failure to reduce the unpaid award to an amount certain prevents it from becoming an enforceable district court judgment.

THE ORDER IS ACCORDINGLY...