Shatoska v. International Grain Transfer, Inc.

• Decision Date: 29 December 1993
• Docket Number: No. CA,CA
• Citation: 634 So.2d 897
• Parties: Troy W. SHATOSKA v. INTERNATIONAL GRAIN TRANSFER, INC. 92 1690.
• Court: Court of Appeal of Louisiana — District of US

Page 897

634 So.2d 897

Troy W. SHATOSKA v. INTERNATIONAL GRAIN TRANSFER, INC.

No. CA 92 1690.

Court of Appeal of Louisiana First Circuit.

Dec. 29, 1993.

Teresa C. Leyva, Kristi L. Stroebel, New Orleans, for defendant-appellant.

Charles N. Branton, Slidell, for plaintiff-appellee.

Before EDWARDS, WATKINS and LeBLANC, JJ.

EDWARDS, Judge.

The defendants, International Grain Transfer, Inc., its worker's compensation insurer, now liquidated, Rockwood Insurance Company, and Louisiana Insurance Guaranty Association (LIGA) appeal a trial court judgment which granted the plaintiff's motion to reinstate worker's compensation benefits. At issue are (1) whether LIGA is entitled to a credit on future benefits owed, in the amount of $32,184, as a result of overpayments erroneously made to the plaintiff by Rockwood; and (2) whether LIGA is entitled to offset the plaintiff's benefits pursuant to LSA-R.S. 23:1225 (as a result of plaintiff's receipt of Social Security benefits) and if so, the nature and extent of such offset.

Background Facts

The facts of this case are not in dispute. In May, 1980, the plaintiff suffered a heart attack which was later determined to be work related. By way of judgment dated January 4, 1984, plaintiff was rendered permanently and totally disabled, and Rockwood was ordered to pay $149 per week in worker's compensation benefits. In January, 1985, as a result of a technical computer error, Rockwood began paying the plaintiff $298 per week, and continued to pay this amount through March 7, 1989. In February, 1990, Rockwood filed a Reconventional Demand for Declaratory Judgment seeking a credit for the overpayments as well as an offset for the social security benefits which plaintiffs applied for and obtained as a result of the judicial determination of his disability. Subsequently, Rockwood entered liquidation and LIGA took over its claims as the insurer. In August, 1991, LIGA summarily terminated the plaintiff's benefits, based on its contention that it is entitled to a credit for the overpayments made by Rockwood. In May, 1991, LIGA filed a motion for summary judgment which was denied. ¹ In February, 1992, plaintiff filed a motion to reinstate benefits. A hearing was held and the trial court rendered judgment on April 16, 1992, reinstating plaintiff's benefits retroactive to the January, 1984 judgment, and ordering an offset for the social security benefits in the amount of $1.15 per week.

Applicability of LSA-R.S. 23:1206

Both, appellants and appellee, argue that the application of LSA-R.S. 23:1206, as it read in 1980 ² when this incident occurred to the facts of this case would yield a result in their favor, respectively. Naturally, their interpretations of the statute and the jurisprudence differ. However, we find this statute and the cases interpreting it inapplicable to the facts of this case, thus we need not determine which interpretation urged is proper. This statute provides for deductions from benefits for "voluntary" payments made by an employer or insurer, when such payments "were not due and payable when made." This statute is designed to reimburse an employer (or insurer) who makes voluntary payments, overpayments or wages equal to or exceeding the amount of compensation after an accident, prior to a judicial determination of disability. Worker's compensation law does not contemplate the payment of wages in addition to payment of compensation benefits, see Moore v. Travelers Insurance Company, 79 So.2d 507, 510 (La.App. 2nd Cir.1955), and the aim of this statute is to remedy such an occurrence. The payments made to the plaintiff by Rockwood were not "voluntary payments" within the contemplation of the statute; they were made pursuant to a judicial order. The fact that a technical error caused the payments to be made in excess of that ordered does not bring such payments within the scope of this statute.

Unjust Enrichment

The issue is more properly resolved by application of LSA-C.C. art. 2301. This statute provides:

He who receives what is not due to him, whether he receives it through error or knowingly, obliges himself to restore it to him from whom he has unduly received it.

LSA-C.C. art. 2302 further provides that "[h]e who has paid through mistake, believing himself a debtor, may reclaim what he has paid." A cause of action is stated in unjust enrichment when there is an enhancement of one estate at the expense of another estate, without cause recognized by law, and for which no other remedy is readily apparent and available. Minyard v. Curtis Products, Inc., 251 La. 624, 205 So.2d 422, 432 (1967). Unjust enrichment was found to exist when a judgment debtor erred in calculating the amount of judicial interest and paid in excess of $100,000 of the amount actually due pursuant to the judgment. In that case, the fourth circuit reversed a trial court judgment and found that the debtor had stated a cause of action for restitution from the creditor's attorneys, who were named as co-payees, and deemed to be "recipients of the payment of a thing not due." New Orleans Public Service, Inc. v. Vanzant, 580 So.2d 533, 536 (La.App. 4th Cir.), writ denied, 584 So.2d 1168 (1991).

The record contains copies of the checks evidencing the overpayment. These checks, issued approximately every two weeks, in the amount of $596 each, were made jointly payable to Troy W. Shatoska and his attorney, Edward A. Shamis and mailed to Mr. Shamis's office. Shatoska does not dispute receiving these payments, nor does he argue that such payments were due when made. Based on the law and the record, we find that the appellants have adequately stated a cause of action of unjust enrichment, and are accordingly entitled to a credit for the $32,184 which was overpaid to the plaintiff and his attorney.

Offset for Social Security Benefits

Following the judgment which rendered him totally and permanently disabled, the plaintiff applied for and obtained social security benefits. LSA-R.S. 23:1225(A) provides:

The benefits provided for in this Subpart for injuries producing permanent total disability shall be reduced when the person receiving benefits under this Chapter is entitled to and receiving benefits under 42 U.S.C. Chapter 7, Subchapter II, entitled Federal Old Age, Survivors, and Disability Insurance Benefits, on the basis of the wages and self-employment income of an individual entitled to and receiving benefits under 42 U.S.C. § 423; provided that this reduction shall be made only to the extent that the amount of the combined federal and worker's compensation benefits would otherwise cause or result in a reduction of the benefits payable under the Federal Old Age, Survivors, and Disability Insurance Act pursuant to 42 U.S.C. § 424a, and in no event will the benefits provided in this Subpart, together with those provided under the federal law, exceed those that would have been payable had the benefits provided under the federal law been subject to reduction under 42 U.S.C. § 424a. However, there shall be no reduction in benefits provided under this Section for the cost-of-living increases granted under the federal law after the date of employee's injury.

Pursuant to this statute, a reduction in compensation shall be made only to the extent that the combined Federal and Worker's Compensation benefits exceed those that would have been payable under the federal law guidelines. Cross v. Travelers Insurance Company, 619 So.2d 610, 616 (La.App. 2nd Cir.1993).

On February 20, 1990, Rockwood filed a Reconventional Demand for Declaratory Judgment in which it asserted its entitlement to an offset for the Social Security benefits received by the plaintiff. In that pleading,...