Opinion
CLAIM NO. E316820
OPINION FILED JANUARY 10, 1995
Upon review before the FULL COMMISSION in Little Rock, Pulaski County, Arkansas.
Claimant represented by the HONORABLE MICHAEL GOTT, Attorney at Law, Jonesboro, Arkansas.
Respondents represented by the HONORABLE WILLIAM C. FRYE, Attorney at Law, Little Rock, Arkansas.
Decision of Administrative Law Judge: Affirmed in part and reversed in part.
OPINION AND ORDER
The respondents appeal an opinion and order filed by the administrative law judge on July 8, 1994. In that opinion and order, the administrative law judge found that the respondents are liable for a penalty for the late payment of indemnity benefits and medical expenses.
This matter was submitted to the administrative law judge upon stipulated facts, letter briefs, and certain documentary evidence which the claimant attached to his letter brief, and this comprises the record on appeal. On February 3, 1994, the administrative law judge filed an opinion and order finding that the claimant sustained a compensable injury on September 7, 1993, and ordering the respondents to pay temporary disability compensation, medical benefits, and an attorney's fee. No appeal was taken from this opinion and order. By letter dated January 27, 1994, the claimant's attorney submitted the claimant's medical bills to the attorney for the respondents, and, in this same letter, he indicated which medical expenses had been paid by the claimant himself and which were still outstanding. Then, by letter dated February 10, 1994, the claimant's attorney advised the attorney for the respondents that the claimant's indemnity payments had not been started and that the claimant was receiving telephone calls from the medical providers requesting payment. In that same letter, the claimant requested a report on the status of the payments to the medical providers, but, apparently, no response was ever received from the respondents. By letter dated March 2, 1994, the claimant's attorney again requested information regarding when the indemnity and medical payments would begin and whether the respondents intended to appeal. Then, by letter dated March 29, 1994, the claimant's attorney asked the administrative law judge to schedule a hearing to consider the respondents' failure to pay indemnity and medical compensation. However, by letter sent by Federal Express on April 4, 1994, to the claimant's attorney, the respondents sent a check for indemnity compensation, medical expenses paid directly by the claimant, and the portion of the attorney's fee withheld from the claimant's compensation. By letter dated April 11, 1994, to the respondents' attorney, the claimant's attorney requested payment for the statutory late payment penalty and for the respondents' portion of the attorney's fee, and he advised the respondents that. By letter dated May 20, 1994, the respondents sent the claimant's attorney their portion of the attorney's fee. The claimant states in his brief that he telephoned his medical providers on April 18 and April 25, 1994 to determine whether they had been paid, and he states that he was advised that no payment had been made. In this regard, the record contains evidence indicating that Associated Radiologists did not receive payment until June 3, 1994, and that this payment included a late payment penalty. However, no other evidence was submitted to support the statement made in the claimant's brief regarding the payments to the medical providers.
The respondents concede that payment was not forwarded to claimant until March 31, 1994. However, they contend that this was due to circumstances entirely beyond their control. In this regard, they state in their brief that they were experiencing numerous computer problems during the month of March and that the respondent carrier was in the process of renovating its offices during that time period, which they contend exacerbated the situation. They contend that these situations resulted in confusion regarding whether the payments had been sent. They also contend that they promptly made payment once they determined that the payments had not been made. Other than the statements contained in their brief, the respondents did not submit any evidence to support these contentions.
Where indemnity compensation is payable under the terms of an award by the Commission which is not appealed, the first payment of compensation does not become due until the time for appeal has expired. Ark. Code Ann. § 11-9-802 (c) (Cumm. Supp. 1993); Ark. Code Ann. § 11-9-711 (1987);Johnson v. American Pulpwood Co, 38 Ark. App. 6, 826 S.W.2d 827 (1992). Thereafter, indemnity compensation is to be paid every two weeks. Ark. Code Ann. § 11-9-802. If any installment of indemnity compensation payable under the terms of an award by the Commission is not paid within fifteen (15) days after it becomes due, Ark. Code Ann. § 11-9-802 (c) provides for the imposition of a penalty equal to twenty percent (20%) of the installment.
In the present claim, the indemnity compensation became due on March 9, 1994, when no petition for review of the administrative law judge's opinion was filed within thirty days after the parties received the administrative law judge's opinion on February 7, 1994. Consequently, the statutory late penalty attached on March 24, 1994, when the payment was not made within fifteen days after it became due. Under Ark. Code Ann. § 11-9-802 (b), the Commission may excuse late payments of compensation payable without an award after a showing by the employer that, owing to conditions over which it had no control, the installment could not be paid within the prescribed time period. Ark. Code Ann. § 11-9-802 (c), which addresses payments payable under an award, does not contain such a provision. However, even if the Commission has such discretion where the installment is payable under an award, we would find that the respondents failed to show that the installment could be paid within the prescribed time period due to conditions over which it had no control. Consequently, we find that a twenty percent (20%) late payment penalty should be added to each indemnity payment not paid within fifteen days after it became due. Therefore, we affirm the administrative law judge's decision in this regard.
Prior to Act 796 of 1993, the statutory penalty for late payment of compensation installments did not extend to the late payment of medical bills. Johnson, supra; Model Laundry Dry Cleaning v. Simmons, 268 Ark. 770, 596 S.W.2d 337 (Ark.App. 1980). However, Act 796 of 1993 amended the Arkansas Workers' Compensation Law to provide the following:
Medical bills are payable within thirty days (30) days after receipt by the respondent unless disputed as to compensability of amount.
In addition, Commission Rule 30, Part I, section G, subsection 4, provides the following:
A carrier shall pay an undisputed and properly submitted bill within 30 days of receipt. Any carrier not paying an undisputed and properly submitted bill within 30 days of receipt shall be assessed an additional penalty of 18% pursuant to A.C.A. 11-9-802.
In addition, subsection 5 provides the following:
When a carrier disputes a bill or portion thereof, the carrier shall pay the undisputed portion of the bill within 30 days of receipt of a properly submitted bill. Any carrier not paying an undisputed portion of the bill within 30 days of receipt shall be assessed an additional penalty of 18% on the disputed portion of the bill.
Neither of these provisions address the situation where the respondent receives the bills but denies liability by challenging the compensability of the claim. Nevertheless, based on Johnson, supra, we find that the respondents had thirty days from the date that the administrative law judge's decision became final on March 9, 1994, to pay the submitted bills without being subject to a penalty. The evidence in the record shows that a check for the medical expenses paid directly by the claimant was forwarded to the claimant's attorney by Federal Express on April 4, 1994. Therefore, we find that payment of these medical expenses was made within thirty (30) days, as required. We note that the record shows that the payment to Associated Radiologists was not made until approximately June 3, 1994, but we also note that the record also shows that this payment included the 18% late penalty. Therefore, we find that the respondents are not liable for any additional penalty on that payment. With regard to the other medical expenses, as noted, no evidence was submitted pertaining to their payment, other than the statements contained in the claimant's brief. Consequently, we find that the claimant failed to prove by a preponderance of the evidence that these payments were not timely made. Therefore, we reverse the administrative law judge's opinion with regard to the assessment of a penalty for the late payment of the medical expenses.
Finally, we find that the administrative law judge correctly found that the respondents are not liable for a penalty for the late payment of the attorney's fee. The Court of Appeals has held on numerous occasions that the statutory penalty for late payment of workers' compensation installments does not apply to attorney's fees. Simmons, supra; Turner v. Trade Winds Inn, 267 Ark. 861, 592 S.W.2d 454 (1980); Frank J. Rooney, Inc. v. Pitts, 268 Ark. 911, 597 S.W.2d 120 (1980); Smith's Store v. Kirker, 6 Ark. App. 222, 639 S.W.2d 751 (1982); Johnson, supra. Therefore, we find that the administrative law judge's decision in this regard should be affirmed.
Accordingly, based on our de novo review of the entire record, and for the reasons discussed herein, we find that the respondents are liable for a penalty for the late payment of indemnity compensation installments to the claimant, but we find that the respondents are not liable for the late payment of the attorney's fee. Therefore, we affirm the administrative law judge's decision with regard to these issues. However, we also find that the respondents are not liable for any additional penalty for the late payment of medical expenses. Consequently, we reverse the administrative law judge's decision in this regard.
All accrued benefits shall be paid in a lump sum without discount and with interest thereon at the lawful rate from the date of the Administrative Law Judge's decision in accordance with Ark. Code Ann. § 11-9-809 (1987). For prevailing in part on this appeal before the Full Commission, claimant's attorney is hereby awarded an additional attorney's fee in the amount of $250.00 in accordance with Ark. Code Ann. § 11-9-715 (b) (1987).
IT IS SO ORDERED.
Commissioner Humphrey concurs.