Snizaski v. W.C.A.B. (Rox Coal Co.)

• Decision Date: 22 February 2006
• Citation: 891 A.2d 1267
• Court: Pennsylvania Supreme Court
• Parties: Renee SNIZASKI, Widow of Randy Snizaski, Deceased, Appellant v. WORKERS' COMPENSATION APPEAL BOARD (ROX COAL COMPANY), Appellees.

891 A.2d 1267

Renee SNIZASKI, Widow of Randy Snizaski, Deceased, Appellant v. WORKERS' COMPENSATION APPEAL BOARD (ROX COAL COMPANY), Appellees.

Supreme Court of Pennsylvania.

Re-Submitted March 16, 2005.

Decided February 22, 2006.

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Fred C. Jug, Pittsburgh, for Renee Snizaski, appellant.

Pamela G. Cochenour, Pittsburgh, for Rox Coal Co., appellee.

Richard C. Lengler, Harrisburg, for W.C.A.B., appellee.

Before: CAPPY, C.J., CASTILLE, NIGRO, NEWMAN, SAYLOR, EAKIN and BAER, JJ.

OPINION

Justice CASTILLE.

This appeal presents the question of whether the Workers' Compensation Judge ("WCJ") erred in granting a claimant's penalty petition against an employer who failed to pay a workers' compensation award within thirty (30) days of the decision of the Workers' Compensation Appeal Board ("the Board") awarding the benefit, in alleged violation of Section 428 of the Workers' Compensation Act ("the Act"),¹ but where the employer failed to pay the award in reliance upon a supersedeas request it timely filed pursuant to Section 111.22 of the Pennsylvania Administrative Code. 34 Pa.Code § 111.22.² This matter requires this Court to address an alleged tension between the Act's penalty provisions and the Board's supersedeas regulations. The Commonwealth Court affirmed the Board's holding that the WCJ erred in awarding a penalty for the period during which the employer's supersedeas request was pending before the Board. For the reasons set forth below, we agree that where, as here, an employer timely files a request for supersedeas pursuant to the Board's regulations, it cannot be subject to a penalty award for failing to pay the underlying benefit during the pendency of the supersedeas petition. Accordingly, we affirm.

Claimant Renee Snizaski ("Claimant") is the widow of Randy Snizaski ("decedent"), who was employed as a coal mine superintendent for Rox Coal Company ("Employer"). On May 7, 1996, decedent died in a one-car motor vehicle accident while on his way to work. Claimant filed a fatal claim petition alleging that her husband's death was compensable under the Act. The WCJ denied the petition. On October 21, 1999, the Board reversed and remanded for the award and computation of benefits. Employer petitioned for reconsideration. On June 13, 2000, the Board denied Employer's petition, computed the amount of benefits due, and ordered Employer to pay Claimant and her children weekly compensation at a rate of $527.

On July 6, 2000, Employer appealed to the Commonwealth Court, and also filed an application for supersedeas with the Board.³ After the expiration of 30 days from the Board's award of benefits, Claimant's counsel demanded payment from Employer. Employer responded that it was not required to make payment while its supersedeas request was pending. Shortly thereafter, however, on July 25, 2000, 42 days after entry of the award, Employer paid Claimant in full (over $147,000). On July 31, 2000, the Board entered a timely order denying Employer's petition for supersedeas. On September 8, 2000, the Commonwealth Court likewise denied Employer's subsequent application for supersedeas.

On November 13, 2000, Claimant filed a penalty petition alleging that Employer had failed to tender payment within 30 days of the Board's June 13, 2000 order, and thus was in default pursuant to Section 428. Employer denied that its payment was late, noting the pendency of its application for supersedeas, and arguing that the Board's regulations contemplate that an Employer's obligation to make payment is stayed in such a circumstance. Employer further argued that, even assuming it was required to commence payment during the pendency of its supersedeas application, a penalty assessment was inappropriate because its payment, at worst, was only 12 days late.

The WCJ granted Claimant's penalty petition, awarding a penalty of ten percent, or $14,771.92, as well as attorney's fees of $2,810.80.⁴ The WCJ held that Employer's payment on July 25, 2000 was late as a matter of law, deeming the supersedeas request pending before the Board to be irrelevant to the penalty question. The WCJ believed that the filing of an appeal and request for a supersedeas alone were insufficient to suspend an employer's obligation to pay benefits under the Act. Instead, only an actual grant of supersedeas was sufficient.

Employer appealed to the Board, which reversed the penalty award and grant of attorney's fees, holding that there was no violation of the Act because Employer had no obligation to pay while its timely supersedeas request was pending. Claimant then appealed to the Commonwealth Court. Claimant relied upon the 2-1 panel decision in Hoover v. Workers' Compensation Appeal Bd. (ABF Freight Systems), 820 A.2d 843 (Pa.Cmwlth.2003), where the panel majority held that a WCJ did not abuse his discretion in awarding a penalty for an employer's failure to pay an award within 30 days, notwithstanding that a supersedeas request was filed and pending. Employer countered that Hoover was wrongly decided and should be overruled. Employer reasoned that, although the Act authorizes penalties at the discretion of the WCJ, such penalties are not mandatory. Employer submitted that it was an abuse of discretion for the WCJ to penalize it where it had relied in good faith upon the Board's supersedeas regulations.

The Commonwealth Court affirmed the Board in a 6-1, en banc published opinion authored by the Honorable Dan Pellegrini. Snizaski v. Workers' Compensation Appeal Bd. (Rox Coal Co.), 847 A.2d 139 (Pa.Cmwlth.2004).⁵ The court agreed with Employer that Hoover was wrongly decided, and thus overruled that panel decision. The majority noted that Hoover had relied on Cunningham v. Workmen's Compensation Appeal Bd. (Inglis House), 156 Pa. Cmwlth. 241, 627 A.2d 218 (1993) and Crucible, Inc. v. Workmen's Compensation Appeal Bd. (Vinovich), 713 A.2d 749 (Pa. Cmwlth.1998), neither of which raised the issue of whether a penalty award is appropriate where the employer had relied upon the supersedeas procedure contemplated by the Board's regulations. The majority further explained that, in Candito v. Workers' Compensation Appeal Bd. (City of Philadelphia), 785 A.2d 1106 (Pa.Cmwlth. 2001), appeals denied, 572 Pa. 711, 813 A.2d 845 (2002) and 572 Pa. 726, 814 A.2d 678 (2002), the panel had held that it was not an abuse of discretion for a WCJ to deny a penalty petition where an employer had failed to pay compensation benefits within 30 days of the award because a request for supersedeas was pending before the Commonwealth Court (a request which that court ultimately granted). The Candito panel reasoned that, "[t]o hold that an employer is liable for penalties for not paying compensation when its request for supersedeas is pending is, in effect, to make an employer's right to seek a supersedeas in most instances a nullity." Candito, 785 A.2d at 1110.

The majority below concluded that, in accordance with the reasoning in Candito, Hoover should be overruled because the Hoover panel had failed to adequately consider the employer's reliance upon the Board's duly-promulgated regulations governing supersedeas. Because the Board's regulations "in effect, purport to stay an employer's obligation to pay" during the pendency of a supersedeas request, the majority held that it was an abuse of discretion for the WCJ to award penalties in the case sub judice. Claimant's request for reargument was denied and this Court granted discretionary review.

In workers' compensation appeals, this Court will affirm the adjudication below unless we find that an error of law was committed, that constitutional rights were violated, that a practice or procedure of a Commonwealth agency was not followed or that any necessary finding of fact is not supported by substantial evidence of record. 2 Pa.C.S. § 704; Colpetzer v. Workers' Compensation Appeal Bd. (Standard Steel), 582 Pa. 295, 870 A.2d 875, 882 (collecting cases). The pertinent historical facts in the case sub judice are undisputed and neither party has alleged a constitutional violation or that an agency practice or procedure was not followed. Nor does Claimant question the Board's underlying power to grant a supersedeas in appeals like this. Instead, the question is a purely legal one concerning whether it is an error of law or an abuse of discretion for a WCJ to assess a penalty against an employer who fails to pay compensation benefits within 30 days of an award, where the employer has timely availed itself of the supersedeas procedure outlined in 34 Pa. Code §§ 111.22-111.24. The issue as presented by Claimant primarily poses a question of statutory construction and, as such, this Court's review is plenary. Colpetzer.

Claimant argues that the plain language of the Act establishes that Employer was in default, which warranted a penalty, and that the Act overrides any contrary suggestion deriving from the Board's regulations. Claimant relies upon Section 428, which provides as follows:

Whenever the employer, who has accepted and complied with the provisions of section three hundred five, shall be in default in compensation payments for thirty days or more, the employe or dependents entitled to compensation thereunder may file a certified copy of the agreement and the order of the department approving the same or of the award or order with the prothonotary of the court of common pleas of any county, and the prothonotary shall enter the entire balance payable under the agreement, award or order to be payable to the employe or his dependents, as a judgment against the employer or insurer liable under such agreement or award. Where the compensation so payable is for a total and permanent disability, the judgment shall be in the amount of thirty thousand dollars less such amount as the employer shall have actually paid pursuant to such agreement or award. Such judgment shall be a lien against property of the employer...