Worker's Comp. Fund v. Industrial Acc. Bd., Civ. A. No. 06M-05-112-JOH.

CourtSuperior Court of Delaware
Writing for the CourtHerlihy
Citation906 A.2d 837
Decision Date04 August 2006
Docket NumberCiv. A. No. 06M-05-112-JOH.
906 A.2d 837
Civ. A. No. 06M-05-112-JOH.
Superior Court of Delaware, New Castle County.
Submitted: July 17, 2006.
Decided: August 4, 2006.

Upon Motion of Defendant Kent Construction to Dismiss the Complaint for Writ of Prohibition and Declaratory Judgement—GRANTED.

Stephanie J. Ballard, Deputy Attorney General, Department of Justice, for Workers' Compensation Fund.

William D. Rimmer, of Heckler & Frabizzio, P.A., Wilmington, DE, for Kent Construction Co.



Workers' Compensation Fund asks this Court to issue a writ of prohibition to bar the Industrial Accident Board from proceeding further with a matter before it in an action brought by Kent Construction Company for reimbursement from the

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Fund. The Board ruled against the Fund on its interpretation of the statute of limitations and set the matter for a subsequent hearing. The Fund has also filed a declaratory judgment action seeking an interpretation of the statute of limitations. Kent Construction has moved to dismiss the Fund's complaint.

Kent Construction sought reimbursement from the Fund because one of its employees suffered a subsequent permanent injury while working for it. When an employee suffers a subsequent permanent injury and becomes totally disabled, the Fund becomes liable for total disability benefits. The Fund argued before the Board that Kent Construction's claim was filed beyond the applicable statute of limitations. The Board rejected the Fund's argument and set the matter down for a hearing on the issues surrounding the total disability claim and on the issue of reimbursement. The outcome of that hearing may trigger the applicability of the statute of limitations.

The Fund contends that by conducting a hearing over a matter which is barred by the statute of limitations, the Board has exceeded its jurisdiction. That in turn, it argues, warrants this Court to issue a writ of prohibition.

The Court holds it would be imprudent to issue the writ which the Fund seeks. The determination of when the statute of limitations begins to run involves factual or other matters which may be in dispute. It is also, therefore, not a matter for an all-encompassing opinion by means of declaratory judgment to draw a bright line between those claims which are time-barred claims and those which are not.

The Fund's complaint for a writ of prohibition and/or for declaratory judgment is DISMISSED.

Factual Background

Kent Construction sought reimbursement from the Workers' Compensation Fund. The Fund, formerly the Second Injury Fund, is established to cover total disability benefits for employees who suffer a subsequent permanent injury rendering them totally disabled.1 But the Fund's potential liability is not without a time limitation:

(a) Whenever a subsequent permanent injury occurs to an employee who has previously sustained a permanent injury, from any cause, whether in line of employment or otherwise, the employer for whom such injured employee was working at the time of such subsequent injury shall be required to pay only that amount of compensation as would be due for such subsequent injury without regard to the effect of the prior injury. Whenever such subsequent permanent injury in connection with a previous permanent injury results in total disability as defined in § 2326 of this title, the employee shall be paid compensation for such total disability, as provided in § 2324 of this title, during the continuance of total disability, such compensation to be paid out of a special fund known as "Workers' Compensation Fund"; any insurance carrier desiring reimbursement from the Fund shall file a petition for payment, provided all claim for reimbursement shall be forever barred unless the insurance carrier files a petition with the Department for reimbursement for payments under this section within 2 year after the date on which the employee was first paid total disability benefits following the subsequent permanent injury.2

The Fund's complaint in this Court indicates Kent Construction's employee,

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James Smith, suffered a subsequent permanent injury on November 15, 1999 and started receiving total disability payments on November 30, 1999. Based on those dates, the Fund moved to have the Board dismiss Kent Construction's petition as barred by the above two year statute of limitations. The Board's decision rejecting the Fund's argument is attached to its complaint. That decision supplies some key details that are relevant to the resolution of the Fund's action in this Court. Those details are:

The Employer responds that the first period of total disability in this case was terminated effective November 21, 2000, before the date of permanency and before the revised statute took effect. The first payment of total disability payment after Claimant's injury became permanent was allegedly December 10, 2004.3

The Board explained its reasons for denying the Fund's motion to dismiss in this way:

The Board recently addressed this same issue in Benton v. Allied Systems, Ltd. and explained that "[t]o effect the overall intent of Section 2327(a), which is to share the burden of total disability payments in second injury cases, the most reasonable reading of the statute is that `first payment' refers to the first payment of total disability after the second injury becomes permanent. An Employer cannot be expected to know that reimbursement is even an option until the injury is permanent." Benton v. Allied Systems, Ltd, IAB No. 1191962, p. 20 (Feb. 22, 2006). Following the reasoning in Benton, the Board here rejects the Fund's interpretation of the statute. The Fund apparently interprets "the date on which the employee was first paid total disability benefits following the subsequent permanent injury" to refer to the first payment after the date of injury, not the first payment after the injury became permanent, an interpretation that would effectively eliminate the modifying word "permanent" from the statute. As in Benton, the Board rejects this interpretation and "interprets Section 2327(a) to require an employer to file a petition for reimbursement of total disability payments within two years after the first total disability payment following the date the second injury became permanent." Id. At 21. It was not clear from the presentation at the legal hearing whether the Fund disputes the date that total disability was first paid after the injury became permanent. To the extent the parties agree that this date was December 10, 2004, the Board finds that the statute of limitations began to run on that date and does not bar the petition in this case. However, if the Fund contests the relevant date, a decision on whether the statute of limitations bars this petition must await a full hearing on the merits of this case. Accordingly, the Board

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denies the Fund's motion to dismiss at this time on statute of limitations grounds, with permission to renew the motion later under the circumstances outlined above.4

Following the Board's denial of the Fund's motion to dismiss, the Fund filed its complaint seeking a writ of prohibition and for a declaratory judgment.5

Parties' Claims

Initially, the Fund contends that Kent Construction's motion to dismiss is premature. It asserts Kent Construction should first answer the complaint for the writ and then it should file its motion which would be followed by full briefing on whether issuing the writ is appropriate. It claims because of Kent Construction's motion, the Court is compelled to accept all well-pled allegations in its complaint as true. The Fund does not argue that the Board did not have original cognizance over the kind of action Kent Construction brought. It maintains, however, that the Board exceeded its jurisdiction by proceeding with a time-barred matter and that it has no adequate remedy at law. Accordingly, the Fund asserts, it is appropriate for this Court to entertain its complaint. The Fund's substantive argument is that when the Board said it would entertain an action barred by the statute of limitations, it exceeded its jurisdiction. By entertaining a matter which cannot be heard under those circumstances, the Board is compelling the Fund to expend unnecessary time and expense.

Kent Construction replies, of course, that the Board's ruling is proper and within its discretion. While titling it a "legal ruling," the ruling was fact dependent and showed that Kent Construction's petition could be timely. Its basic argument, however, is that the Fund's complaint in this Court is a circumvention of the normal appeal process. It contends the Fund's complaint, in reality, is an interlocutory appeal. Kent Construction also argues that to allow the Fund to have this kind of review opens the door to all sorts of interlocutory appeals on such issues, for instance, as a decision on whether a claimant is an independent contractor or an employee or whether the injury was in the scope of employment, etc.

Applicable Standards

The Court concurs with the Fund's statement that Kent Construction's motion to dismiss filed before it has answered the complaint compels the Court to accept the Fund's well-pled allegations as true.6 By implication so is the principle that on a motion to dismiss the Court must determine if the Fund can obtain its writ (and/or get a declaratory judgment) under any conceivable circumstances.7


This Court has the jurisdiction to issue a writ of prohibition to the Industrial Accident Board.8 In the normal course of matters emanating from Board decisions, this Court is the first court to which an appeal is taken.9 Despite the Fund's argument that Kent Construction's motion is premature, the Court views the procedural posture of this case to have ripened the issue of the appropriateness of whether a

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writ should issue. The Fund's argument...

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