W.C. Nos. 4-353-893, 4-212-853Industrial Claim Appeals Office.
March 1, 2001
FINAL ORDER
Slade Glass Company (Slade) and its insurer, Liberty Mutual Fire Insurance Company (Liberty Mutual) seek review of an order of Administrative Law Judge Gallegos (ALJ) which imposed penalties for Liberty Mutual’s failure timely to pay temporary disability benefits. We affirm.
The claimant suffered compensable low back injuries in 1994 and 1997 while working for Slade. In 1994 Slade was insured by Liberty Mutual. In 1997 Slade was insured by CNA Insurance Company. After the claims were closed the claimant’s condition worsened. A dispute arose about the cause of the worsened condition. However, in June 2000, the parties entered into a written stipulation for the apportionment of liability for additional workers’ compensation benefits. The stipulation was approved in an order dated June 30, 2000.
Paragraph 7 of the stipulation stated, “Payment of temporary disability benefits shall be paid pursuant to § 8-42-105 and 8-42-106, C.R.S., based upon the temporary disability rates set forth on the respective last Final Admissions of Liability of the Respondents. Liberty Mutual Insurance Company will pay 70% of claimant’s temporary disability benefits and CNA Insurance Company will pay 30% of claimant’s temporary disability benefits The parties reserve the right to challenge the rate at which temporary disability benefits are paid as well as the duration of benefits paid.”
By letter dated July 13, 2000, claimant’s attorney requested the reinstatement of temporary disability benefits effective July 12, the date the claimant underwent additional surgery for the industrial injury. On August 3, 2000, Liberty Mutual filed a general admission of liability for the payment of temporary total disability benefits retroactive to July 12, 2000. However, Liberty Mutual did not issue the first payment until August 17, 2000. Liberty Mutual issued additional payments on August 24, September 19, September 21, and October 11, 2000.
The claimant applied for a hearing and requested penalties at the rate of $500 per day under § 8-43-304(1), C.R.S. 2000, for Liberty Mutual’s failure to reinstate temporary disability benefits in accordance with the June 30 order. The ALJ found Liberty Mutual violated the June 30 order by failing to pay temporary disability benefits commencing July 26, 2000, and failing to make the subsequent payments every two weeks as required by § 8-42-105(2)(a), C.R.S. 2000. Specifically, the ALJ found the August 17 payment was 21 days late, the August 19 payment was 12 days late and the October 11 payment was 6 days late. Consequently, the ALJ imposed penalties at the rate of $500 per day for 39 days.
On review Liberty Mutual contends the record does not support the ALJ’s findings that Liberty Mutual violated the June 30 order. We disagree.
Section 8-43-304(1) provides for imposition of a penalty where a person or party “violates any provision” of the Workers’ Compensation Act (Act) or “fails, neglects, or refuses to obey any lawful order.”
The claimant concedes that the parties’ stipulation did not specify a date temporary disability benefits were to begin, and the stipulation does not identify an event which triggered a duty to pay temporary disability benefits. In fact, the agreement allows the parties to dispute the rate and duration of payments. Presumably, this would include the right to dispute the date on which temporary disability, if any, commenced.
Similarly, the June 30 order did not require Liberty Mutual to pay temporary disability benefits. The order merely required any payments made to be paid in accordance with the terms of the stipulation. Consequently, we agree with Liberty Mutual that there is insufficient evidence to support the ALJ’s finding that Liberty Mutual’s failure to admit liability for temporary disability benefits before August 3, 1999, violated the June 30 order.
Moreover, nothing in either § 8-42-103 or § 8-42-105
expressly requires an insurer, which has properly terminated temporary disability benefits voluntarily to reinstate temporary disability benefits, and we may not read that requirement into the statute. See Colorado Compensation Insurance Authority v. Industrial Claim Appeals Office, ___ P.2d ___ (Colo.App. No. 99CA1624, June 22, 2000); Best-Way Concrete Co. v. Baumgartner, 908 P.2d 1194 (Colo.App. 1995). Section 8-42-103(1)(a)-(f), C.R.S. 2000, provides that if an injury or occupational disease “causes disability” over three days, disability benefits shall be paid as wages pursuant to § 8-42-105(2), and reduced by any applicable offset. However, § 8-42-103(1) does not preclude the insurer from disputing whether the injury has caused a “disability” which warrants the payment of temporary disability benefits for a particular period. Instead, the insurer may dispute liability for temporary disability benefits until factual issues concerning the existence of a “disability” are resolved by an ALJ. See Allison v. Industrial Claim Appeals Office, 916 P.2d 623
(Colo.App. 1995). Consequently, Liberty Mutual’s failure to admit liability for temporary disability payments until August 3 did not violate any statute.
However, once liability was admitted, the June 30 order required Liberty Mutual to pay compensation in accordance with §8-42-105. Subsection 8-42-105(2)(a) provides that:
“Compensation shall be paid at least once every two weeks, except where the director determines that payment in installments should be made at some other interval. The director may by rule convert monthly benefit schedules to weekly or other periodic schedules.” (Emphasis added).
Rule of Procedure, Part IV(E)(2), 7 Code Colo. Reg. 1101-3 at 5, provides that, “temporary disability benefits awarded by admission are due on the date of the admission and payable once every two weeks thereafter.” Thus, the Director of the Division of Workers’ Compensation (Director) has determined that past due installments of temporary disability benefits must be paid on the date an admission is filed, and subsequent payments must be made at least once every two weeks after the first payment.
Because Liberty Mutual filed an admission of liability for temporary total disability benefits on August 3, 2000, all benefits due and owing between July 12 and August 3 were due and payable on the date of the August 3 admission. The record supports the ALJ’s finding that Liberty Mutual did not make any payment until August 17. Therefore, the findings support the conclusion Liberty Mutual violated the June 30 order by failing to pay temporary disability in accordance with § 8-42-105.
In reaching this conclusion we reject the claimant’s contention that because the stipulation did not specify a date for the commencement of temporary disability benefits, the ALJ was entitled to find that a “reasonable” date for the commencement of benefits was July 26, 2000. See Colorado Womens’ College v. Bradford-Robinson Printing, Co., 114 Colo. 237, 157 P.2d 612
(Colo. 1945) (Where no time for performance is specified in a contract, the legal effect is that it is to be performed within a reasonable time). As stated above, the parties’ stipulation did not require Liberty Mutual to voluntarily admit liability for temporary disability benefits. Under these circumstances, the ALJ could not reasonably find Liberty Mutual agreed to begin compensation payments on July 26.
We also reject Liberty Mutual’s argument that, pursuant to § § 8-43-401(2), C.R.S. 2000, disability payments were not due until 30 days after the date of its admission. Section 8-43-401(2) does not govern the payment of benefits based upon an admission. To the contrary, the statute is applies to the payment of benefits required by an order and requires that such payment must commence within 30 days after “all appeal have been exhausted or in cases where there have been no appeals.”
Nevertheless, we agree with Liberty Mutual that the ALJ miscalculated the penalties. The August 17 payment was due August 3 and, thus, was 14 days late. The next payment was due August 17, but was not made until August 24. Therefore, it was 7 days late. The next payment was due August 31 and not made until September 19. Consequently, it was 19 days late. The next payment was due September 14, but payment was not issued until September 21. Thus, it was 7 days late. The next payment was due September 28, and was not made until October 11. This payment was 13 days late. Therefore, the total of late payments equaled 60 days. However, the error enured to the benefit of Liberty Mutual because the ALJ found only 39 days of late payments. Under these circumstances, the ALJ’s error does not establish grounds to afford Liberty Mutual appellate relief, and the claimant did not appeal.
Finally, Liberty Mutual contends it had no notice the claimant sought penalties for late installment payments. Therefore, it contends the ALJ denied it procedural due process by assessing penalties for the failure timely to make payments after July 26. We are not persuaded.
The claimant’s Application for Hearing listed the issue as penalties “$500 per day pursuant to § 8-43-304(1) for failure to timely pay temporary total disability benefits pursuant to Order of 6/30/2000 [sic] is the Order Rule, or Section of the act violated. The violation began on 6/25/2000 and is continuing.”
The parties’ stipulation expressly stated that payments would be made in accordance with § 8-42-105, and the June order required the payment of compensation pursuant to the terms of the stipulation. Consequently, the claimant’s request for penalties due to a “continuing” violation of the June order afforded Liberty Mutual adequate notice of the claimant’s allegation that the ALJ would adjudicate the claimant’s right to penalties for Liberty Mutual’s late installment payments.
IT IS THEREFORE ORDERED that the ALJ’s order dated November 2, 2000, is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ David Cain
____________________________________ Kathy E. Dean
NOTICE
This Order is final unless an action to modify or vacate this Order is commenced in the Colorado Court of Appeals, 2 East 14th Avenue, Denver, CO 80203, by filing a petition for review with the Court, within twenty (20) days after the date this Order is mailed, pursuant to § 8-43-301(10) and § 8-43-307, C.R.S. 2000. The appealing party must serve a copy of the petition upon all other parties, including the Industrial Claim Appeals Office, which may be served by mail at 1515 Arapahoe, Tower 3, Suite 350, Denver, CO 80202.
Copies of this decision were mailed March 1, 2001 to the following parties:
Edward C. Bennett, P. O. Box 806, Platteville, CO 80651
Slade Glass Co., 1770 38th St., Boulder, CO 80301-2604
Transportation Insurance Co., Judy McKim, CNA Insurance, P. O. Box 17369 T. A., Denver, CO 80217
Chad Saunders, Liberty Mutual Fire Insurance Company, 13111 E. Briarwood Ave., #100, Englewood, CO 80112
W. M. Busch, Jr., Esq., 903 N. Cleveland, #A, Loveland, CO 80537 (For Claimant)
David G. Kroll, Esq., 1120 Lincoln St., #1606, Denver, CO 80203 (For Respondents Slade Glass Co. and Liberty Mutual Fire Insurance Company)
Kim D. Starr, Esq., 2629 Redwing Rd., #330, Ft. Collins, CO 80526 (For Respondents Slade Glass Co. and Transportation Insurance Co. CNA Insurance)
BY: L. Epperson