Robb, Leonard and Mulvihill v. WCAB

• Decision Date: 15 February 2000
• Citation: 746 A.2d 1175
• Parties: ROBB, LEONARD AND MULVIHILL and The Travelers Insurance Co., Petitioners, v. WORKERS' COMPENSATION APPEAL BOARD (HOOPER), Respondent.
• Court: Pennsylvania Commonwealth Court

746 A.2d 1175

ROBB, LEONARD AND MULVIHILL and The Travelers Insurance Co., Petitioners, v. WORKERS' COMPENSATION APPEAL BOARD (HOOPER), Respondent.

Commonwealth Court of Pennsylvania.

Submitted on Briefs December 8, 1999.

Decided February 15, 2000.

F. David Dermotta, Pittsburgh, for petitioners.

Catherine Wojciechowski and Martin C. Cunningham, Harrisburg, for respondent.

Before DOYLE, President Judge, and COLINS, J., McGINLEY, J., PELLEGRINI, J., FRIEDMAN, J., KELLEY, J., and LEADBETTER, J DOYLE, President Judge.

Robb, Leonard and Mulvihill (Employer) and The Travelers Insurance Company (collectively, Petitioners) petition for review of an order of the Workers' Compensation Appeal Board (Board) that amended an order of a Workers' Compensation Judge (WCJ) and denied Petitioners' application for full reimbursement from the Supersedeas Fund.

Linda Hooper (Claimant) worked for Employer, a law firm, as a senior legal assistant when she suffered a work-related injury to her hands and wrists on June 22, 1990, and, pursuant to a Notice of Compensation Payable, Claimant began to receive disability benefits. On June 10, 1991, Claimant was examined by her treating physician, Dr. Arnold S. Broudy, and was released to return to work. Employer offered Claimant her time-of-injury position, but Claimant declined to accept the proffered employment and chose to retire instead for personal reasons. Beginning June 24, 1991, Petitioners unilaterally suspended Claimant's benefits. On December 30, 1991, Petitioners filed a petition to modify and/or suspend Claimant's benefits on the basis that Claimant had been offered employment within her medical restrictions but had refused the job offer. Petitioners also filed an application for supersedeas, which the WCJ granted on April 14, 1992, effective March 31, 1992. However, the WCJ ordered Petitioners to pay to Claimant the compensation benefits that had been withheld from her from June 24, 1991, through March 31, 1992. Petitioners appropriately followed the WCJ's order and paid Claimant accordingly. Ultimately, by a decision dated October 28, 1993 (circulated on November 3, 1993), the WCJ granted Petitioners' suspension petition effective June 24, 1991.

Petitioners subsequently, on February 25, 1994, filed an application for reimbursement from the Supersedeas Fund, which the WCJ granted for the entire period that benefits were paid, from June 24, 1991, through March 31, 1992, the date that the supersedeas was granted.¹ The Bureau of Workers' Compensation appealed from the WCJ's decision to the Board, arguing that Petitioners were not entitled to be reimbursed for that period of time during which Employer had unilaterally stopped paying Claimant's benefits. The Board noted that under Section 443 of the Workers' Compensation Act (Act),² supersedeas reimbursement is awarded from the filing date of the request, in this case, December 30, 1991, rather than from the date on which the insurer summarily and unilaterally stops making payments (June 24, 1991):

To grant [Petitioners] reimbursement from the date [Petitioners] unilaterally and summarily stopped making payments would endorse and encourage employers/insurers to unilaterally cease paying benefits in direct violation of the Act. The Board does not encourage such violational behavior.

(Board's Decision at 4.) The Board therefore determined that the WCJ's decision should be amended to provide for reimbursement only from December 30, 1991, the date that the request for supersedeas was filed, through March 31, 1992, the date the supersedeas was granted, thus excluding that period of time prior to Petitioners' application for a supersedeas. This appeal followed. On appeal,³ Petitioners argue that the Board committed an error of law by amending the WCJ's decision. More specifically, Petitioners contend that, even though a portion of the benefits they paid is attributable to a period of Claimant's entitlement prior to the date that a supersedeas was requested, i.e., December 30, 1991, Petitioners are entitled to reimbursement from the Supersedeas Fund for the entire period, i.e., from June 24, 1991, through March 31, 1992, because payment was actually made for that entire period; that, although made subsequent to the request for a supersedeas, all benefits were paid pursuant to an order of the WCJ.

Before an employer/insurer may obtain reimbursement from the Supersedeas Fund, the following five requirements must be met:

1. A supersedeas must have been requested;

2. The request for supersedeas must have been denied;⁴

3. The request must have been made in a proceeding under Section 413 of the Act;⁵

4. Payments were continued because of the order denying supersedeas; and

5. In the final outcome of the proceedings, `it is determined that such compensation was not, in fact, payable.'

Bureau of Workers' Compensation v. Workmen's Compensation Appeal Board (Liberty Mutual Insurance Company), 113 Pa.Cmwlth. 607, 538 A.2d 587, 589 (1988) (emphasis added). In this appeal, the WCJ issued an order granting a supersedeas, but also issued a separate order requiring Petitioners to pay the previously withheld benefits; that is, the WCJ ordered the employer and its insurer to pay benefits retroactively. Petitioners contend that they are entitled to reimbursement for the entire period because the benefits were paid pursuant to the WCJ's separate order, and therefore pursuant to a ruling on their request for supersedeas. In response, the Bureau of Workers' Compensation argues that, because Petitioners unilaterally suspended benefits, payments were not "continued" as a result of the order denying supersedeas, and thus the fourth requirement above was not met in this case.

In support of its argument that the WCJ correctly granted reimbursement for the entire period, Petitioners cite to St. Margaret Memorial Hospital v. Workmen's Compensation Appeal Board (Kusenko), 152 Pa.Cmwlth. 631, 620 A.2d 586 (1993). In Kusenko, the employer had unilaterally stopped paying benefits to the claimant when he returned to work on June 5, 1989. Subsequently, on September 29, 1989, the employer filed a request for a supersedeas, alleging that the claimant's benefits should cease as of June 5, 1989, the date on which claimant had returned to work.⁶ A referee⁷ denied the employer's request for a supersedeas, and on November 6, 1989, the employer issued a compensation check to the claimant for his loss of wages for the period from June 21, 1989,⁸ to September 29, 1989. On April 25, 1990, the referee concluded that the claimant was not entitled to compensation for that period of time. Thereafter, the employer sought reimbursement from the Supersedeas Fund, which the referee granted. The Board, however, reversed the referee's award and concluded that, although the payment was made to the claimant after the employer filed a request for a supersedeas, the employer was requesting retroactive reimbursement for a payment attributable to the claimant's alleged disability for a period of time prior to filing its request for a supersedeas. Thus, the Board denied the employer's request for reimbursement on the basis that such retroactive reimbursement is not permitted.

On appeal to this Court, we reversed the Board's decision under the reasoning that Section 443(a) of the Act permits the reimbursement of compensation erroneously paid to a claimant even after a request for a supersedeas has been denied, and the period of time for which payment is made is irrelevant. However, after reviewing our decisions addressing this issue both prior to and after Kusenko, we recognize an inconsistency in that Kusenko is contrary to every other opinion that has been decided by this Court.⁹ Contrary to our holding in Kusenko, it is settled law that reimbursement under Section 443 is appropriate only for the period following the date on which the request for a supersedeas was filed. Pennsylvania Macaroni Co., Inc. v. Workmen's Compensation Appeal Board (Cahill), 36 Pa.Cmwlth. 267, 387 A.2d 949 (1978). In Cahill, the insurer filed a petition for termination of compensation and a request for a supersedeas on August 4, 1972. The referee failed to act upon the request for supersedeas, and the insurer ceased making compensation payments on December 9, 1972. Some months later, the referee conducted a hearing on the termination petition and granted the petition effective June 22, 1972, the date that the referee decided that the claimant could have returned to work. The insurer applied for reimbursement from the Supersedeas Fund for the period June 22, 1972 through December 9, 1972, which the referee granted.

The Board reversed and concluded that, under Section 443 of the Act, reimbursement is only permitted when a supersedeas request has been denied, and, because the referee never decided the insurer's supersedeas request in this case, there could be no reimbursement. On appeal to this Court, we reversed the decision of the Board and held that the insurer was entitled to reimbursement because to deny reimbursement would be to penalize the insurer for the referee's inaction and to be at odds with the legislative intent behind the Act. However, we limited reimbursement to the period commencing after the insurer had filed its request for a supersedeas, and denied reimbursement for the period between June 22, 1972, the effective date of the termination, and August 4, 1972, the date that the insurer filed its supersedeas request:

Th[e] language [of Section 443] makes it clear that reimbursement is due only for those payments made subsequent to the request for supersedeas. There is nothing in the wording of Section 443 which would indicate a Legislative intent to provide for reimbursement retroactive to the date the referee determined that the employe could return to work without any loss of pay or disability. We are of the view that reimbursement under Section 443 is appropriate only for the period

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