W.C. No. 4-417-697Industrial Claim Appeals Office.
January 16, 2002
FINAL ORDER
The claimant seeks review of an order of Administrative Law Judge Stuber (ALJ) which determined the claimant’s request for penalties was barred by the one-year statute of limitations in § 8-43-304(5), C.R.S. 2001. We affirm.
The pertinent facts are undisputed. The claimant suffered a compensable injury in February 1999. On November 18, 1999, a Division-sponsored independent medical examiner (DIME) assigned a four percent whole person impairment rating. The respondent-insurer received the DIME’s report on December 13, 1999.
On May 11, 2001, the claimant filed an application for hearing and requested an order imposing penalties under § 8-43-304(1), C.R.S. 2001, for the respondents’ failure to comply with the Rules of Procedure, Part IV(N)(6), 7 Code Colo. Reg. 1101-3. That rule provides that within 30 days after the mailing of the DIME’s report, the insurer shall either admit liability consistent with the DIME’s medical impairment rating or file an application for hearing on the issue of medical impairment.
The respondents concede they did not comply with Rule IV(N)(6) until June 2001. The respondents did not issue any payment for permanent partial disability benefits until June 5, 2001 and did not file a final admission concerning the payments until June 27, 2001. Rather, the respondents defended the penalty claim on grounds it was barred by §8-43-304(5), C.R.S. 2001, which states:
A request for penalties shall be filed with the director or administrative law judge within one year after the date that the requesting party first knew or reasonably should have known the facts giving rise to a possible penalty. (Emphasis added).
The claimant received a copy of the DIME’s report in December 1999. Under these circumstances, the ALJ determined the claimant knew or reasonably should have known by January 31, 2000, that the respondent-insurer violated Rule IV(N)(6). The ALJ found the claimant did not request penalties until he filed an application for hearing on May 11, 2001, which was after the expiration of the one-year statute of limitations and, therefore, the ALJ denied the penalty claim.
On review, the claimant contends the ALJ misconstrued § 8-43-304(5) to require the filing of a request for penalties within one year of the insurer’s initial violation even if there is a continuing violation. In support, the claimant relies on § 8-43-305, C.R.S. 2001, which provides that “every day” an insurer violates the Workers’ Compensation Act (Act) “shall constitute a separate and distinct violation” for which penalties may be imposed. Accordingly, the claimant contends the May 11, 2001 application for hearing was a timely request for penalties based on the respondent-insurer’s violation of Rule IV(N)(6) between May 11, 2001, and June 27, 2001. We are not persuaded by this argument.
Statutes must be construed in such a manner as to further the legislative intent with which they were enacted. Humane Society of the Pikes Peak Region v. Industrial Claim Appeals Office, 26 P.3d 546
(Colo.App. 2001). To discern the intent of the General Assembly, we must first examine the language of the statute. Ihnen v. Western Forge, 936 P.2d 634 (Colo.App. 1997). In so doing, words and phrases should be given their plain and ordinary meaning, unless the result is absurd Snyder Oil Co. v. Embree, 862 P.2d 259 (Colo. 1993). If the statutory language is clear and unambiguous, the statute must be applied as written, and it is unnecessary to resort to other rules of statutory construction. Ackerman v. Hilton’s Mechanical Men, Inc., 914 P.2d 524
(Colo.App. 1996).
Under § 8-43-304(5) a request for penalties must be filed within one year of the date a party “first” knows or reasonably should know “the facts giving rise to a possible penalty.” Webster’s New Collegiate Dictionary (1995) defines the term “first” to mean coming before all others, or earliest in time. Applying this definition, we conclude that § 8-43-304(5) requires a request for penalties to be filed within one year after the requesting party first became aware of the circumstances which constitute a violation and support the imposition of a penalty, even if that violation was ongoing.
Here, the claimant does not dispute the ALJ’s finding that the claimant knew or reasonably should have known the respondent-insurer was in violation of Rule IV(N)(6) when he did not receive permanent disability payments, an admission of liability for permanent disability benefits, or an application for hearing from the respondents by the end of January 2001. Accordingly, the statute limitations commenced by February 1, 2000, and the ALJ did not err in finding that the statute of limitations had expired prior to the filing of the claimant’s May 11, 2001 application for hearing.
Contrary to the claimant’s contention, our conclusions are not inconsistent with our holding in Adkinson v. National Rooter, W.C. No. 4-197-635
(August 11, 1995). Unlike the circumstances presented here Adkinson did not involve a statute of limitations issue. Rather, the issue in Adkinson was whether an ALJ misconstrued the curing provisions of § 8-43-304(4), C.R.S. 2001, in finding that no penalties can be imposed for a violation which occurs prior to the violator’s receipt of an application for hearing on the issue of penalties. We concluded the plain language of § 8-43-304(4) does not purport to preclude the imposition of penalties for violations which occur prior to the time the violator receives notice of the penalty claim. In so doing, we noted that the ALJ’s construction of § 8-43-304(4) was inconsistent with the fact that § 8-43-305 allows for the imposition of a separate penalty for each day of the violation. Accordingly, we concluded that it is “§ 8-43-305 which defines when a violation has occurred for purposes of the Act.”
However, we did not conclude in Adkinson that § 8-43-305 governs the date of the violation for purposes of the statute of limitations. In fact, the obvious purpose of § 8-43-304(5) is to ensure the prompt litigation of penalty claims. This purpose would be eviscerated under the claimant’s construction because as long as the violation continued, there would be no time limit for filing a request for penalties.
The claimant’s remaining arguments have been considered and are not persuasive. We believe the insurer’s potential exposure to a per diem penalty plus interest creates a sufficient disincentive for an insurer to delay payment of accrued benefits.
IT IS THEREFORE ORDERED that the ALJ’s order dated August 30, 2001, is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
____________________________________ Kathy E. Dean
____________________________________ Bill Whitacre
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. 2001. 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 January 16, 2002 to the following parties:
Robert L. Spracklin, 903 S. Zeno Way, #201, Aurora, CO 80017
Supervalu, Cub Foods, 8055 Sheridan Blvd., Arvada, CO 80003-1910
Liberty Mutual Insurance Co., 13111 E. Briarwood Ave., #100, Englewood, CO 80112
Mary Anders, Liberty Mutual Insurance Co., P. O. Box 168208, Irving, TX 75016-8208
Barbara Carter, Special Funds, Tower 2, #630, Division of Workers’ Compensation — Interagency Mail
William J. Macdonald, Esq., 3515 S. Tamarac Dr., #200, Denver, CO 80237 (For Claimant)
Keith E. Mottram, Esq., 1200 17th St., #1700, Denver, CO 80202 (For Respondents)
BY: A. Pendroy