Soares v. Max Services, Inc.

Decision Date18 September 1996
Docket NumberNo. 14663,14663
Citation679 A.2d 37,42 Conn.App. 147
CourtConnecticut Court of Appeals
PartiesPaolo SOARES v. MAX SERVICES, INC., et al.

Joseph A. La Bella, Hartford, for appellant (named defendant et al.).

Loida John-Nicholson, Assistant Attorney General, with whom, on the brief, were Richard Blumenthal, Attorney General, and William J. McCullough, Assistant Attorney General, for appellee (second injury fund).

Before DUPONT, C.J., and SPEAR and HEALEY, JJ.

HEALEY, Judge.

On October 3, 1989, the plaintiff, Paolo Soares, suffered a back injury that arose out of and in the course of his employment by the defendant, Max Services, Inc. Max Services, Inc., had, theretofore, insured its potential liability under the Workers' Compensation Act (act), General Statutes § 31-275 et seq., with the defendant Commercial Union Insurance Companies. The plaintiff had suffered a prior injury that was compensable under the act, as a result of which his disability from the October 3, 1989 injury was materially and substantially greater than would have resulted from his second injury alone. See General Statutes (Rev. to 1989) § 31-349(a). 1

Pursuant to § 31-349(a), the defendants sought to transfer liability to the second injury fund (fund) effective at the end of the first 104 weeks of the plaintiff's disability. From the date of his second injury, the 104 week period ended on October 2, 1991. Ninety days prior to that date was July 5, 1991.

On November 29, 1990, the defendants sent the fund a written notice of their intention to seek to transfer liability to the fund. Attached to that notice were documents supporting their claim. A copy of the voluntary agreement as to benefits payable to the plaintiff was not furnished by the defendants to the fund before July 5, 1991. By letter dated December 4, 1990, the fund acknowledged receipt of the defendants' November 29, 1990 letter of notice. The fund indicated, however, that this notice was incomplete because it "lack[ed] necessary approved voluntary agreement or award ... lack[ed] current medical information (less than three months old) and lack[ed] social security number."

Thereafter, by letter dated January 18, 1991, the fund wrote to the defendants' attorney, indicating that the defendants' notice to the fund was incomplete because it "lack[ed] current medical information (less than three months old)" and that it "lack[ed] necessary approved voluntary agreement or award." By letter dated March 7, 1991, 2 the fund wrote to the defendants' attorney, indicating that it had received from him "up-to-date medical information relating to the claim," but that the notice to the fund was still incomplete as of that date because it "lack[ed] necessary approved voluntary agreement or award." 3

By March 18, 1991, the parties had signed the voluntary agreement. The workers' compensation commissioner (commissioner) approved that agreement on October 28, 1991. It was not, however, until February 10, 1992, that the defendants provided the fund with a copy of the approved voluntary agreement. February 10, 1992, was 219 days after the ninety day statutory period had expired.

On March 17, 1992, Yinxia Long, a paralegal specialist for the fund, wrote to the attorney for the defendants, stating: "This is a follow-up to our discussion of the case on February 10, 1992. The October 3, 1989, injury qualifies for transfer to the Fund. Please kindly forward transfer agreement and accounting for review." On July 22, 1992, the fund wrote to the attorney for the defendants, stating in part: "Per our telephone conversation of 6/14/92, I am returning the proposed transfer agreements in this matter. The Fund will not voluntarily accept transfer under § 31-349 as the voluntary agreement was not received by the Fund within the statutory period." 4 As indicated in that letter, the fund maintained that the 104th week of benefits ended on October 1, 1991, and the voluntary agreement was not approved until October 28, 1991. Pointing out that all parties had signed the voluntary agreement by March 18, 1991, the letter noted that the agreement could have been approved and sent to the fund within the statutory period.

The commissioner decided that the defendants, "having failed to follow the directives of the statute [§ 31- cannot prevail in [their] attempt to transfer liability to the Fund." In doing so, he said: "It does appear that the claim qualifies for transfer, but the process of transfer requires that the statutory directives be observed. One of those directives requires the insurer to furnish to the Custodian of the Fund a copy of the (Voluntary) agreement." (Emphasis added.) 5 In concluding that the statute required that a copy of the voluntary agreement be provided to the fund ninety days prior to the expiration of the 104th week, the commissioner relied on Kramer v. General Electric Co., 37 Conn.Supp. 742, 436 A.2d 50 (1981), a case decided by the Appellate Session of the Superior Court.

Thereafter, the defendants petitioned the compensation review board (board) for review of the decision of the commissioner. In that appeal, they claimed that the commissioner improperly (1) interpreted § 31-349 in finding that the defendants had failed to comply with the requirements of that statute and (2) failed to find that the fund had either waived its right to contest liability or had become estopped from denying liability.

The board affirmed the decision of the commissioner. In doing so, it held that the commissioner did not misinterpret the ninety day provision of § 31-349(a) in requiring that a copy of the voluntary agreement be supplied to the custodian of the fund within that time limit. It relied on Kramer v. General Electric Co., supra, 37 Conn.Supp. 742, 436 A.2d 50, which in turn had relied on Plesz v United Technologies Corp., 174 Conn. 181, 384 A.2d 363 (1978), as well as on two of its own recent decisions. 6 In support of its decision, the board quoted Kramer that the object of the ninety day statutory notice " 'is to enable the fund to assess its alleged liability quickly and thereby immediately establish its financial reserves, with a further objective being to give the fund reasonable time to investigate the claim and prepare to meet it.' " The board was not persuaded by the defendants' argument of the effect of legislative actions in 1969 and 1971 changing the "relevant wording of § 31-349." In addition, the board did not accept the defendants' claim that the fund had waived its right to refuse to accept liability by virtue of the fund's letter of March 17, 1992. The board indicated that it did not think that a waiver was possible because it is well established that there had to be strict compliance with the notice provisions of the act, including § 31-349. Opining that because the fund was a creature of statute the powers of which were defined and limited by statute, the board maintained that representatives of the fund did not "have the power to waive the jurisdictional requirements of the very statutes that define the Fund's duties and liabilities."

Similarly, the board rejected the claim that the fund should be estopped from denying acceptance of the case and, in doing so, did not agree with the defendants' claim that the fund was not a governmental agency for the purposes of estoppel. Rather, it chose to follow its own decision in Dos Santos v. F.D. Rich Construction Co., 12 Conn.Workers' Comp.Rev.Op. 64 (1994) because of the limits on the fund's representatives to circumvent statutory requirements. Noting that, as to estoppel, the defendants would have to prove detrimental reliance on the alleged action of the fund's representatives, the board did not accept the estoppel claim. It gave two reasons for denying that claim: the inability of the fund representatives to waive jurisdictional requirements and the statement by fund representatives concerning the alleged acceptance of the plaintiff's claim in 1992, "long after the statutory time limit for producing a copy of the agreement or award had already expired." The board affirmed the decision of the commissioner and this appeal followed.

On appeal, the defendants first claim that the notice provisions of § 31-349 do not preclude the transfer of the plaintiff's claim to the fund. Included within that claim are the defendants' arguments that the board applied the wrong standard to this claim, that the board improperly interpreted the notice provision of § 31-349 in saying that it required that the fund be given a voluntary agreement by a specific date, that their construction of the statute satisfies the purposes of the notice requirement and that they did satisfy the notice requirements of § 31-349. Second, they claim that the fund is estopped from denying liability for the plaintiff's claim and that the fund is not a governmental agency. Third, they claim that the fund has waived any defense of improper notice pursuant to § 31-349.

On the other hand, the fund claims, first, that the board correctly found that the defendants' notice of claim for transfer was not timely filed as required by § 31-349 and that it, therefore, properly denied their claim for transfer to the fund. Second, it claims that the defendants cannot invoke estoppel because the elements of estoppel are lacking in this case. Third, it claims that there has been no waiver.

I

In arguing that the notice provisions of § 31-349 do not preclude the transfer of liability to the fund, the defendants claim that the board applied "the wrong legal standard." They maintain that the board improperly relied on its own decision in Dos Santos v. F.D. Rich Construction Co., supra, 12 Workers' Comp.Rev.Op. 64, in which the defendants contend that the board "interpreted the statute as requiring a respondent seeking to transfer liability to the Fund to supply it with an approved voluntary agreement." ...

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