*1 640 TRYCO STEEL CORPORATION v MAGLOTHIN 1984, 14, 72599, at Detroit. March 72682. Submitted Docket Nos. 18, September 1984. Decided Corporation, Tryco Maglothin, employee Steel of A. an Cecil compensation Tryco job workers’ injured in 1976. and its on the Company, paid carrier, American Insurance Great insurance Maglothin. weekly compensation to general disability hearing 1979, petition Maglothin with the Bureau a for filed In seeking Compensation Disability differential bene- of Workers’ hearing the A referee denied Fund. fits from the Second appealed Maglothin to the Work- benefits. claim for differential During pendency Appeal of that Compensation Board. ers’ Supplement Compensation Legislature appeal, created pay Tryco Maglothin requested Great American Fund. pendency during compensation supplement him a American, upon Bureau appeal. Tryco advice of the and Great compensation Disability Compensation that no of Workers’ WCAB, pending before due while a case is hearing petitioned contest- request. Maglothin for a denied the request for Tryco’s denial of his and Great American’s that, hearing be- compensation supplement. referee held Maglothin’s dispute ongoing entitle- cause there was no benefits, Tryco compensation general disability weekly required to were and Great American there pending appeal. also found that The referee providing a purposes of the statute was an for no nonpayment there is of benefits where Tryco’s penalty payment impose any and declined to American’s earlier refusal and Great WCAB, appealed supplement. Maglothin that decision pending one and with the earlier which consolidated the Maglothin benefits and entitled to differential _ruled [1-3] [1, [3] Tort 4, 82 Am Jur Workmen’s or 82 Am 825] refusal to make liability Am Jur Workmen’s Jur Workmen’s 2d, References of worker’s 2d, 2d, for Points Compensation 579. Compensation 658. due. Compensation 8 ALR4th 902. Headnotes insurer for §§ 476, wrongful delay 635. Tryco failure imposed and Great American for compensation supplement pending timely pay the first challenging appeal, appeal. Tryco and Great American finding payment penalty was due for that a late the WCAB’s appeal. timely pay their failure *2 appeals, contending Injury Fund that differential The Second by two-year-back rule and that are limited benefits statutory applying the interest rate to erred in 12% prior payments to the effective date of the which became due appeals consolidated. Held: The have been statute. imposing payment penalty The WCAB erred in the late 1. Maglothin’s right ongoing dispute there was an as to because supplement. receive failing apply two-year-back rule 2. erred in The WCAB to the WCAB the facts of this case. The case is remanded applying two-year- calculation of differential benefits for rule. back applied correctly rate interest 3. The WCAB 12% prior of the due to the effective date which became providing that interest. statute part, part and remanded. Affirmed in reversed Hood, P.J., part. part He concurred in and dissented opinion part majority that finds dissented from that of the payment penalty Maglothin late because not entitled to the right dispute ongoing to receive the as to his there was an supplement. that there was an He would hold only Maglothin’s to differential compensation supplement, was to the supplement. that the WCAB entitled to the He would also hold payment assessing penalty late of the was correct in major- respects, In all other he concurred with opinion. ity
Opinion of the Court Compensation Supplement — Compensation — Differ- 1. Workers’ Appeal. — ential Benefits Compensation Appeal Board to It was error for the Workers’ compensation impose penalty a for a defendant’s failure to plaintiffs appeal from the denial while the Disability Compensation by referee a Bureau of Workers’ plaintiffs where the differential benefits until benefits could not be determined receive the (MCL eligibility resolved his for differential benefits was 418.801[2]; 17.237[801][2]). 137 Mich Compensation Payment — — 2. Workers’ Late of Benefits Penal- ties. aspect employee’s An as to one of an claim for workers’ benefits will not bar payment categories for late of other unrelated of bene- fits. Compensation — 3. Workers’ Interest on Awards. past compensation payment The date on which a due workers’ applied made determines the rate of interest to be payment; payment January amount of the where is made after computed per interest on the amount due is at 12% payment due, regardless annum from the date the (MCL date of the award and the date the was due 418.801[5]; 17.237[801][5]). by Hood, P. J. Partial Concurrence and Partial Dissent Compensation Compensation — Supplement — 4. Workers’ Fail- Pay Supplement Penalty. — ure to Compensation Appeal impos- Workers’ Board did not err in a for a defendant’s failure to plaintiffs appeal while from the denial *3 Disability Compensation Bureau of Workers’ referee of differen- tial beneñts was where there was no (MCL general as to the beneñts 418.801[2]; 17.237[801][2]). MSA Compensation Compensation — Supplement — 5. Workers’ Fail- Pay Supplement — ure to Good Faith Defense. upon Compensation Good faith Supplement reliance Fund imposition directive is no defense to the of a for nonpayment compensation supplement of a recipient where a of workers’ beneñts was entitled to the supplement; nonpayment required deliberate is not for the (MCL 418.801[2]; 17.237[801][2]). MSA Gale, Charles G. plaintiff. for Gorny, Thaddeus A. Conklin, Benham, Mc- and Ducey Ottaway, Leod, hell), & P.C. (by Martin L. Critc- counsel, of for Tryco Steel Corporation and Great American Insurance Company. Kelley,
Frank J. Louis J. General, Attorney Tryco Steel Opinion op the Court Caruso, Binno, M. General, Joseph Solicitor and General, Assistant Attorney Second Cardew, Jr., Ray W. Fund, Assistant Attorney General, Compensation Supplement Fund. Hood, P.J.,
Before: and V. J. and P. E. Brennan Deegan,* JJ. Plaintiff injured was at work on
Per Curiam. 28, 1976, September when the deck of a parking garage on which he working collapsed, caus- ing plaintiff to fall onto a steel rod. (defen-
and Great American Insurance Company dants), paid general disability weekly compensa- pursuant tion benefits to the Worker’s Disability Compensation Act. On May filed petition for hearing with the Bureau of Workers’ (bureau) Disability Compensation claiming that he had suffered total and permanent industrial loss of use of legs both and seeking differential benefits from the Second Fund pursuant to MCL 17.237(521X2).
The hearing referee denied the claim for differ ential benefits. Plaintiff appealed from the decision Compensation Workers’ Appeal Board the. (WCAB). While the pending, Legis lature created within Compensation the bureau a Supplement (CSF), Fund from which or employers insurers are reimbursed for compensation supple paid pursuant 418.352; to MCL MSA 17.237(352). request Plaintiff’s of defendants * judge, sitting Appeals by assignment. Circuit on the Court of 17.237(352) 418.352; employees established the 17.237(351) receiving compensation 418.351; benefits under MCL *4 supplement to be employee’s weekly compensa- based on the responsible pay tion rate. The insurer or self-insurer is to the ment and is entitled to reimbursement for the from the CSF, 418.391; 17.237(391), CSF. The established is by legislative appropriation general financed from tax revenues of the state. 644 Opinion op the Court during pen- supplement compensation pay the upon appeal dency advice the WCAB was denied supplement compensation that no from the bureau pending before WCAB. is due while a case hearing petitioned for a Rule V contest Plaintiff compensation pay refusal to defendants’ appeal. pending The ref ongoing dispute that, since there was no eree held as to general disability plaintiff’s entitlement to weekly benefits, defendants were supplement pending required to appeal.2 However, found the referee WCAB meaning there was an within 17.237(801)(2) and there of MCL impose any penalty payment for fore declined to compensa earlier refusal defendants’ tion appealed the referee’s denial of
Plaintiff from That the late to the WCAB. appeal appeal earlier from the de- nial of differential benefits were consolidated. On June that holding issued a decision WCAB of industrial had sustained the loss legs use of both and was therefore entitled pen- imposed and, further, differential benefits alty timely pay failure to defendants for pending the first WCAB appeal. Both defendants and the Second appeal. challenge Fund Defendants the WCAB’s finding payment penalty due for that a late timely pay defendants’ failure appeal. The Second finding Fund does not contest WCAB’s plaintiff’s eligibility for differential but (1) contends that such differential benefits are only plaintiffs involved claim plaintiffs benefits. Defendants have not contested weekly disability compensation benefits. *5 Opinion of the Court rule of MCL two-year-back
limited (2) 17.237(381X2) 418.381(2); interest rate in applying erred 12% 17.237(801X5) in MCL established due to the effec- prior became which the statute. tive date of
I erred in first consider whether We 801(2) for defendants’ imposing § bene- compensation supplement failure to the denial of from fits while pending. benefits was 17.237(801X2) provides: benefits, weekly accrued weekly "If bills, benefits, not or travel allowance are medical becoming payable due and in cases days within 30 after ongoing dispute, per day there is not an $50.00 where day paid to the worker for each over shall be added and benefits, bills, medical or travel days 30 allowance are not in which the $1,500.00 paid. than in Not more may pursuant added to this subsection.” total be The WCAB held: dispute regarding plaintiffs entitle- "There was no benefits, including weekly manner, timely failure to Defendant’s same though good even on a faith based belief due, application ment was not is sufficient to warrant ongoing dispute regarding total and penalty. undisputed permanent bearing disability has no preclude
weekly
benefit and
Mfg Co
penalty application. Perry
v Sturdevant
11;
App
(1983)].”
Section 352 that employees receiving maximum benefits under 351 are entitled to a § supplement recipient’s based on the weekly com- 352(5) pensation rate. Section states: "An employee eligible who is to receive differential injury benefits from the second fund shall be supplement pursuant to this section as by reduced the the amount payments being of the differential made employee by injury the second fund at the time of the supplement pursuant to this section.” (Emphasis supplied.)
It
is true that an ongoing dispute
as to one
aspect of an employee’s claim for benefits will not
bar
of a penalty for late payment of
other
categories
unrelated
of benefits. See Perry v
Co,
Sturdevant Mfg
App 11;
333 NW2d
(1983).
Relying on Perry,
supra,
found that
there was
ongoing
no
weekly benefits,
including
sup-
plement,
since the pending appeal
only
involved
However,
benefits.
quoted
the above
statute makes clear
that an
right
employee’s
the compensation
is
affected
directly
by
amount of differential
benefits he or she
receives. This is precisely
the CSF
why
advised
defendants
that payment of
Opinion of the Court
had
issue of differential benefits
until
not due
plain
Inasmuch as
the WCAB.3
been resolved
could not be
to receive the
tiff’s
for differential ben
eligibility
until his
determined
resolved,
WCAB
we find that
efits was
an
of differential benefits was
of the denial
The WCAB
dispute as
801(2).
in
imposing
erred
II
from the
appeals
Fund also
Injury
The Second
Fund does
decision. The Second
WCAB’s
of differential
but
contest
the award
failing
to apply
that
the WCAB erred
asserts
rule of MCL
two-year-back
17.237(381)(2).4
Plaintiff
concedes
two-
applicable
limitation
instant
year-back
case,
The case is therefore
re
and we so hold.
of differen
for calculation
manded to
381(2).
applying
tial benefits
finally
The Second
Fund
contends
interest
rate
applying
the WCAB erred
12%
*7
17.237(801X5)
418.801(5);
in
MSA
established
MCL
prior
which became due
to the effec-
to
statute,
1,
of the
1982. The
January
tive date
argument
rejected by
Second
Fund’s
in Selk v Detroit
Michigan
the
Supreme Court
benefits. The CSF reimburses
policy providing
ing
tial benefits. If the
Second
supplement pursuant
made for
with the bureau.”
391
3
[4]
"If
According
MCL
a determination
any compensation
prior
date
418.381(2);
any period
a final determination of the
to the CSF’s
Fund reimburses the CSF for
which the
MSA
payment
of time earlier
employee
to of the
17.237(381X2)
352(5).
sought
employee
appellate
employee’s
of the
qualifies
employer
than
brief,
filed an
compensation supplement pend-
provides:
this
for differential
2
employee’s right
the CSF has
entitlement
years
act,
application
any overpayment
or insurer
payment
immediately preced-
adopted a new
to differential
for a
pursuant
shall
to differen-
hearing
not
be
to
640
137 648
by Hood, P. J.
Partial Dissent
Products,
1;
The WCAB’s 17.237(801X2) late of 418.801(2); payment benefits is reversed. of differen- for recalculation is remanded The case provision two-year-back limited tial benefits 17.237(381)(2). of MCL in and re- part, part in reversed Affirmed manded. concurring in (dissenting part P.J.
Hood,
part
dissent
from that
part).
respectfully
I must
plaintiff
that
finds the
opinion
majority
352
because there
not entitled to a §
dispute”
plaintiff’s
as to
"ongoing
was an
plaintiff’s
At no time did
supplement.
receive the
plaintiff’s right
to receive
contest
employer
352(1),
benefits. Section
17.237(352)(1),
supple-
payment
mandates
1982,
1,
"Beginning
an
plaintiff,
January
receiving or entitled to receive benefits
employee
* * *
shall be entitled to a
weekly
added.)
compensation”.
(Emphasis
Defendants
do
not
that
is not entitled to
argue
Rather,
provision.
ments under
this
defendants
argue
there
remained
an
because
to beneñts,
paid
employer need
have
Co,
Perry
Mfg
v Sturdevant
In
124
11, 17;
(1983),
Mich App