PERRY v STURDEVANT MANUFACTURING COMPANY
Docket No. 60555
124 MICH APP 11
March 9, 1983
Submitted November 3, 1982, at Detroit.
The WCAB erred in holding that the penalty provisions of the statute providing for payment of a penalty by an employer or carrier who delays payments of workers’ compensation benefits for more than 30 days are not applicable to the payment of the 70% benefits while the award is being appealed. Dismissal of the carrier‘s claim of appeal may still be used as a coercive tool or to punish wilful nonpayment. Perry‘s claim that the WCAB abused its discretion by denying her motion to dismiss the сlaim for review is moot.
Affirmed in part, reversed in part, and remanded.
J. H. GILLIS, J., dissented. He would affirm the decision of the WCAB. He believes that the penalty provisions for an employer‘s or carrier‘s nonpayment of workers’ compensation benefits are not applicable to nonpayment of the 70% benefits paid
REFERENCES FOR POINTS IN HEADNOTES
[1] 73 Am Jur 2d, Statutes § 194.
[2] 31 Am Jur 2d, Exemptions §§ 7-9, 120.
[3-6] 82 Am Jur 2d, Workmen‘s Compensation § 658.
OPINION OF THE COURT
1. STATUTES — JUDICIAL CONSTRUCTION.
Judicial construction of a statute based on an analysis of legislative intent is neither required nor permitted where the words of the statute are clear and unambiguous.
2. STATUTES — EXEMPTIONS.
Generally, exemptions contained in a statute should be scrutinized carefully by the judiciary.
3. WORKERS’ COMPENSATION — PENALTIES.
The statute providing for payment of a penalty by an employer who delays payments of workers’ compensation benefits for more than 30 days requires that the benefits be due and payable and that there be no ongoing dispute (
4. WORKERS’ COMPENSATION — PENALTIES.
The penaltiеs provided for a carrier‘s nonpayment of workers’ compensation benefits, accrued weekly benefits, medical bills or travel allowance “within 30 days after becoming due and payable in cases where there is no ongoing dispute” are applicable to the nonpayment of the 70% payments provided to a claimant during an appeal by the carrier from an order of the Workers’ Compensation Appeal Board, although dismissal of the claim of appeal may also be useful as a coercive tool or to punish a carrier‘s wilful nonpayment (
DISSENT BY J. H. GILLIS, J.
5. WORKERS’ COMPENSATION — DELAY IN PAYMENTS — PENALTIES.
The statute providing for payment of a penalty by an employer who delays payment of workers’ compensation benefits for more than 30 days requires that the benefits be due and payable and that there be no ongoing dispute; an award is considered to be in dispute while review or appeal is pending and during the time periods permitted for filing a claim for review or for appeal (
The Legislature, by limiting the 30-day penalty for nonpayment of workers’ compensation benefits to cases where there is no ongoing dispute, did not intend the penalty to be imposed against an employer or carrier who fails to comply with the requirement that 70% of the weekly benefit awarded by the hearing referee be paid to the claimant during an appeal by the employer or carrier; the appropriate remedy against an employеr or carrier who fails to pay the 70% benefits is dismissal of the claim for review or the appeal (
Marston, Sachs, Nunn, Kates, Kadushin & O‘Hare, P.C. (by Granner S. Ries), for plaintiff.
Ulanoff, Ross, Summer, LaKritz, Wesley & Bloom, P.C. (by Carmen C. Tice), for defendant.
Before: BRONSON, P.J., and V. J. BRENNAN and J. H. GILLIS, JJ.
BRONSON, P.J. The claimant appeals by leave granted a decision of the Workers’ Compensation Appeal Board (WCAB), denying her request for imposition of the penalty for late payment provided for in § 801 of the Worker‘s Disability Compensation Aсt (WDCA),
After a hearing before a Bureau of Workers’ Disability Compensation referee, the carrier was ordered to pay claimant weekly benefits of $106.67, on August 23, 1978. The carrier filed a timely claim for review with the WCAB, pursuant to
“A claim for review filed pursuant to sections 859 or 861 shall not operate as a stay of payment to the claimant of 70% of the weekly benefit required by the terms of the hearing referee‘s award. Payment shall commence as of the date of the hearing referee‘s award and shall continue until final determination of the appeal or for a shorter period if specified in the award.”
Inadvertently, the carrier stopped making payments to the claimant on December 3, 1979. On January 25, 1980, the claimant filed a motion to dismiss the carrier‘s claim for review. The carrier resumed making payments on February 3, 1980. The claimant‘s mоtion to dismiss was denied on February 8, 1980. The claimant requested that a $50 per day penalty be imposed on the carrier pursuant to
“MCL 418.801(2) and MCL 418.862 are similar in legislative purpose. Both are remedies. But each has its own special area of application. They are mutually exclusive. MCL 418.801(2) was designed to insure prompt payment of compensation where there is no asserted or legally valid ongoing dispute as to entitlement. MCL 418.862 was intended to provide the successful hearing level claimant with some minimal economic process; that is, while the claim continued to be disputed. It would do grave violence to clear legislative intent and remedial purposes of these provisions if we
were to mix them up and hold that MCL 418.801(2) penalties are to be assessed against late payments of weekly 70% benefits which are coercively required to be paid even though there is an ongoing dispute with respect to entitlement and the merits of the claim. The procedural remedy for failure to comply with the 70% requirement is dismissal of the defense appeal. McAvoy v HB Sherman Co, 401 Mich 419 (1977); Karbel v Greyhound Food Management, 1975 WCABO 1851. It follows, of course, that penalties would immediately attach should such a dismissal occur with legal finality. This is not, however, an issue of remedial redundancy. It is simply that the penalty provisions just do not apply to the late payment of 70% benefits with respect to ongoing disputed claims pursuant to MCL 418.862; and this is precisely because we are dealing with a case in which there is indeed an ‘ongoing dispute‘.” (Emphasis in original.)
Although the board‘s decision rests heavily on its analysis of legislative intent, we must first consider appellees’ claim that the language of § 801 clearly and unambiguously precludes imposition of the statutory penalty for failure to pay “70% benefits“. If the words of a statute are clear and unambiguous, judicial construction based on an analysis of legislative intent is neither required nor permitted. Dussia v Monroe County Employees Retirement System, 386 Mich 244, 248-249; 191 NW2d 307 (1971). We must, however, also observe the general rule that exemptions in а statute are scrutinized carefully. Grand Rapids Motor Coach Co v Public Service Comm, 323 Mich 624, 634; 36 NW2d 299 (1949).
We must begin by examining appellees’ reliance on our opinion in Charpentier v Canteen Corp, 105 Mich App 700; 307 NW2d 704 (1981). This Court was asked to decide when the 30-day “grace period“, during which a carrier may fail to make required payments without incurring the statutory
“[O]ur interpretation does not work undue hardship upon compensation beneficiaries by making them wait for complete payment. By statute, claimants receive 70% of their weekly benefits during the pendency of review or appeal. MCL 418.862; MSA 17.237(862), McAvoy v HB Sherman Co, 401 Mich 419; 258 NW2d 414 (1977). They are not deprived of income during that period.” Charpentier, supra, p 707.
Far from supporting the position taken by appellees, the rationale underlying the Charpentier decision appears to support the claim that statutory penalties may be assessed for nonpayment of 70% benefits. The analysis in Charpentier indicates only that, when the entitlement to immediate payment is the subject of “an ongoing dispute“, the exсeption in
We cannot agree with appellees’ claim that
“If weekly compensation benefits, accrued weekly benefits, medical bills, or travel allowance are not paid within 30 days after becoming due and payable in cases where there is no ongoing dispute, $50.00 per day shall be added and paid to the worker for each day over 30 days in which the compensation, medical bills, or travel allowance are not paid. Not more than $1,500.00 in total may be added pursuant to this subsection.”
The term “cases” in the phrase “cases in which there is no ongoing dispute” does not mean contested cases before the bureau and does not refer to a claim of an employee against hеr employer, which may or may not lead to the payment of benefits. “Cases” means “instances” or “situations” and refers to “weekly compensation benefits, accrued weekly benefits, medical bills, or travel allowance“. By using the word “or” in this phrase, the Legislature indicated that nonpayment in any category will trigger the penalty provision, even if an ongoing dispute exists concerning a payment in a different category; e.g., nonpayment of admittedly due weekly benefits is not excused by the presence of a dispute over a medical bill. This interpretation is not only the only one which gives meaning to every phrase in
Appellees do not seriously contend that an ongoing dispute concerning any aspect of a claim bars the imposition of a penalty for nonpayment. They argue, however, that a dispute concerning the underlying liability for specific benefits is an “ongoing dispute” even though the WDCA requires immediate payment of the benefits in question. Appellant claims that “cases” in the phrаse “cases where there is no ongoing dispute” refers, inter
We again find that the statutory language is ambiguous. The language used by the Legislature was extremely general and, we believe, was intended to encompass all situations in which the problem of nonpayment might arise, even those “cases” in which there is no contested case. Furthermore, the Legislature‘s listing of types of payments in the alternative shows an intent to require carriers to make each payment promptly as it becomes due. We conclude that the Legislature‘s language not only permits interpretation to advance its purposes but invites it.
The purpose of § 862 was explained by the Supreme Court in MсAvoy v HB Sherman Co, 401 Mich 419, 438; 258 NW2d 414 (1977):
“1975 PA 34 represents an attempt by the Legislature to instill new vitality into the Worker‘s Disability Compensation Act. The Legislature evidently realized that the ultimate goal of the worker‘s compensation schema was being thwarted by an appellate process which was merely a traditional carry-over from existing tort concepts of liability. Workers were not receiving the benefits awarded by the referees and were often subject to being whipsawed into settlements for lesser benefits in order to avoid the lengthy appellate process.” (Footnote omitted.)
Prompt payment of “70% benefits” was considered
The purpose behind the statutory penalty can best be understood by examining how the provision works. Thirty days after an undisputed payment becomes due but remains unpaid, the penalty is imposed. No good faith defense is provided; deliberate nonpayment is not required for the imposition of a penalty. The Legislature‘s purpose must have been not only to penalize those who refuse to pay but to force all carriers to be conscientious in their duty to make prompt payments by deterring even unintentional nonpayment.
Appellees can draw a clear logical distinction between payment of “70% benefits” and payment for which the liability has never been contested or has been finally decided. Distinctions based on ultimate liability are, however, totally unrelated to the purposes underlying
Finally, we address the WCAB‘s holding that dismissal of a claim for review is the exclusive remedy for nonpayment of “70% benefits“. The remedy of dismissal was not supported by the language of any statute but was implied from the absence of a specific remedy in the WDCA itself
If dismissal is the exclusive remedy for nonpayment of “70% benefits“, the WDCA leaves a large gap in its provision for assuring payment of benefits. A claim for review may be dismissed by the WCAB for nonpayment of “70% benefits“.
More importantly, dismissal is a far more arbitrary remedy than that provided for in
Appellant‘s claim that the WCAB abused its discretion by denying her motion to dismiss the claim for review is moot. Appellees have not sought to appeal the WCAB‘s September 16, 1981, denial of their claim.
Remanded to the WCAB for proceedings consistent with this opinion. No costs, neither party having prevailed in full.
V. J. BRENNAN, J., concurred.
J. H. GILLIS, J. (dissenting). I respectfully dissent. At the time of the board‘s decision,
“If weekly compensation benefits, accrued weekly benefits, medical bills, or travel allowance are not paid within 30 days after becoming due and payable in cases where there is no ongoing dispute, $50.00 per day shall be added and paid to the worker for each day over 30 days in whiсh the compensation, medical bills, or travel allowance are not paid. Not more than $1,500.00 in total may be added pursuant to this subsection.” (Emphasis supplied.)
In Charpentier v Canteen Corp, 105 Mich App 700; 307 NW2d 704 (1981), lv den 412 Mich 887 (1981), a panel of this Court held that the 30-day grace period provided in
“An award is to be considered in dispute while review
or appeal is pending and during the time periods permitted for filing a claim for review or of appeal.” Charpentier, supra, p 705.
See, also, Clark v General Motors Corp, Chevrolet Assembly Plant, 117 Mich App 387; 323 NW2d 714 (1982).
In my opinion the Legislature, by limiting
I am in agreement with the interpretation given