Subsequent Injury Fund v. Howes, 253

• Decision Date: 25 February 1971
• Docket Number: No. 253,253
• Citation: 11 Md.App. 325,274 A.2d 131
• Parties: SUBSEQUENT INJURY FUND v. William Oliver HOWES.
• Court: Court of Special Appeals of Maryland

Page 325

11 Md.App. 325

274 A.2d 131

SUBSEQUENT INJURY FUND v. William Oliver HOWES.

No. 253.

Court of Special Appeals of Maryland.

Feb. 25, 1971.

Certiorari Denied May 3, 1971.

Albert A. Levin and William H. Kable, Special Asst. Attys. Gen., for appellant.

James S. McAuliffe, Rockville, for appellee.

Argued before ORTH, MOYLAN and POWERS, JJ.

POWERS, Judge.

An accidental injury sustained on June 16, 1966 by William Oliver Howes during the course of his employment as a furnace cleaner for Metropolitan Fuels Company, Inc. was followed in due course by his compensation claim. Further proceedings arising out of the claim require us to determine what the Subsequent Injury Fund is, and what it may do and must do under Maryland law. This appeal by the Subsequent Injury Fund was taken from an 'opinion and order' of the Circuit Court for Montgomery County granting a motion by Howes for summary judgment. Hereafter in this opinion we shall refer to the Subsequent Injury Fund as the Fund, to Mr. Howes as Claimant, to the Workmen's Compensation Commission as the Commission, and to Metropolitan Fuels Company, Inc. and its workmen's compensation insurance carrier as Employer and Insurer.

Procedural History of the Case

Claimant duly filed his claim with the Commission which, after hearing, passed an order on October 31, 1967 against the Employer and Insurer finding that the Claimant sustained a permanent partial disability amounting to 30% industrial loss of use of his body as a result of an injury to his heart, and further found that of that disability 15% was attributable to the accidental injury and 15% was attributable to a pre-existing condition.

Dissatisfied with the finding of the Commission, Claimant filed an order for appeal to the Circuit Court for Montgomery County alleging in his petition that he sustained a permanent partial disability of 50%, none of which was attributable to a pre-existing condition. While this first appeal was pending, Claimant with leave of court filed an amended order and petition alleging that he sustained a permanent total disability or a permanent partial disability amounting to 50% or more, none of which was attributable to a pre-existing condition.

As will be seen later in this opinion, that amended claim on appeal exposed the Fund to the potential risk of an order upon it for payment of money. Thereupon, the Employer and Insurer filed a motion to continue the case and to remand it to the Commission so that the Fund could be impleaded as a party. Claimant opposed this motion and took the position that the Fund was not involved and would not be involved because of his contention that none of his disability was attributable to a pre-existing condition.

Thereafter, the Employer and Insurer filed in the pending appeal a pleading which purported to be a third party claim against the Fund. Counsel presumably appearing for the Fund filed a motion to dismiss the appeal as to it and the motion was granted.

The case then proceeded to trial on June 27, 1968 before a jury under the provisions of Code, Art. 101, § 56. It does not appear that any questions of law were raised at the trial of the appeal, as may be done under § 56 when misconstruction of the law is asserted. Questions of fact were submitted to the jury, and it determined as a matter of fact that Claimant had a permanent partial disability of 90%, and of that amount, 15% was because of a pre-existing disease or infirmity.

A certified copy of the docket entries in the Circuit Court, recording the findings of the jury on the issues submitted to it, was then transmitted to the Commission. Thereafter the Commission passed an order on December 20, 1968 awarding the Claimant compensation payable by the Employer and Insurer for a 75% permanent partial disability. Claimant promptly requested a hearing before the Commission on the ground that the award did not comply with the jury's findings, but on January 20, 1969 filed a new appeal in the circuit court from the December 20th order. This second appeal lay dormant until December.

The Commission held a hearing in February, 1969 on the issues of whether the Fund was a party and whether to make an award for the additional 15% permanent partial disability, to be paid from the Fund. On October 23, 1969 it declined to do so, finding that the Fund was not a party to the claim at the initial hearing nor in the appeal from the order which followed that hearing and that any further proceedings against the Fund were res judicata. From the Commission order of October 23, 1969, Claimant filed a third appeal which in December was consolidated with the pending second appeal. Claimant then filed a motion for summary judgment in his favor in the two cases. The Fund filed a motion to dismiss the two appeals on the ground that it had been dismissed as a party in the first appeal and the principle of res judicata barred the two subsequent appeals.

Claimant's motion for summary judgment did not specify against what or against whom judgment should be entered. Neither the second nor the third appeal was captioned against the Subsequent Injury Fund. However, after mail receipt of the papers, an Assistant Attorney General 'appeared' for the Fund, and participated as if it were a party. The Employer and Insurer showed no interest, and indeed had none, in these appeals.

After hearing arguments on the motion the court, on April 3, 1970, in a brief ruling (later transcribed and filed) said: 'For these reasons the Court will grant, and does grant, the motion for summary judgment on behalf of the appellant in this case.' The docket entry merely records that the motion was granted. An order to enter an appeal 'on behalf of the Subsequent Injury Fund' was filed by the Assistant Attorney General. The record before us has been supplemented, with leave of court, by the record in the Claimant's first appeal.

Statutory History of the Fund

The concept of providing some means of compensating an injured employee for that portion of disability which pre-existed the injury upon which a current claim is based was first introduced into the law of Maryland when Acts of 1945, ch. 637 was passed and became effective on June 1, 1945. This act created a special fund known as the 'Second Injury Fund' and provided that if an employee who had previously lost or lost the use of a hand, arm, foot, leg or eye, lost another of those members of organs in a compensable accidental injury and thereby became permanently and totally disabled, the employee was entitled to receive additional compensation beyond that awarded against the employer for the current injury, such additional compensation to be paid from the Second Injury Fund upon the written order of the Commission. The Treasurer of the State of Maryland was made custodian of the fund with limited administrative responsibilities. The Second Injury Fund was provided with only one source of income, produced by charges against employers or their indemnitors at a flat rate per accidental injury occurring after June 1, 1945. These payments were made to the Commission, and by it remitted to the State Treasurer.

The intent of the 1945 act was stated to be, '* * * to make the total payments to which such employee shall become entitled equal to the compensation that would be due for permanent total disability.' The act also contained a provision that in any case which shall come before the Commission involving payments from that fund, the Commission may, if it deems it necessary or desirable, request the Attorney General to furnish a member of his staff to represent the fund in hearings before it.

The Second Injury Fund thus created appeared to operate satisfactorily without major statutory change and without appellate judicial interpretation until 1963. Amendments not significant here were made by Acts of 1955, ch. 597, and Acts of 1957, ch. 584.

Acts of 1963, ch. 809, codified as Code, Art. 101, § 66, accomplished a major broadening of the original concept. The Subsequent Injury Fund was created and succeeded to the function of and pending claims against the Second Injury Fund. Orders by the Commission for payment from the Fund were no longer limited to cases of permanent total disability caused by the loss of a second enumerated member or organ. The 1963 changes provided for payments of additional compensation to an injured employee who sustained any injury in a compensable accident while previously suffering any kind of permanent impairment due to a previous accident or a disease or any congenital condition provided that the end result was permanent total disability or permanent partial disability exceeding 50% of the body as a whole.

The act still provided for payments by employers or their insurers to the Commission, but based upon a percentage of awards rather than upon a flat rate, and still required that all such payments be remitted by the Commission to the State Treasurer. Another change of some significance was that the Commission was required rather than merely permitted to request the Attorney General to furnish a member of his staff to represent the Fund in hearings before it in any case involving payments from the Fund. It failed to specify how the Commission, prior to its finding, should determine that a case would be one involving payments from the Fund.

Acts of 1964, ch. 56 amended § 66 to correct grammatical errors only, and Acts of 1967, ch. 154 increased the assessment percentage for payments to the Commission to be remitted to the Fund and increased the upper and lower limits of the level at which the...