Opinion
CASE NO. 1360 CRD-7-91-12
NOVEMBER 8, 1993
The claimant was represented by Douglas Daniels, Esq., who neither filed a brief nor appeared at oral argument.
The respondent-employer was represented by James R. Fogarty, Esq. and Jennifer Cohen, Esq., Epstein and Fogarty.
The respondent-insurer was represented by Janine D'Angelo-Bracken, Esq., Law Offices of Robert S. Cullen.
The Second Injury Fund was represented by Robin Wilson, Esq., Assistant Attorney General.
This Petition for Review from the December 12, 1991 Finding and Award of the Commissioner for the Seventh District was heard December 18, 1992 before a Compensation Review Board panel consisting of the Commission Chairman Jesse Frankl and Commissioners Angelo L. dos Santos and Donald H. Doyle, Jr.
OPINION
Compensability of the claimant's injury is not in dispute. Instead the respondent-employer claims on appeal that the Seventh District Commissioner improperly determined that it was not insured by the respondent-insurer at the time of claimant's injury. In support of its claim, the employer asserts that (1) the trial commissioner should have precluded the insurer from denying liability pursuant to General Statutes (Rev. to 1989) Sec. 31-297 (b) and (2) the trial commissioner, in determining whether a contract of workers' compensation insurance existed between the employer and insurer on the date of injury, should not have limited his resolution of that issue to an examination of the records of the Workers' Compensation Commission at its central office in Hamden, that is, solely to a determination of whether there is on file in the Hamden office a certificate of such insurance effective on the date of injury. Because we agree with the employer's second argument, we reverse the decision of the trial commissioner and remand the matter to the Seventh District for further proceedings to determine whether a contract of workers' compensation insurance existed between the employer and the insurer on the date of the claimant's injury.
General Statutes (Rev. to 1989) Sec. 31-297 (b) as existed on the date of injury, provided in pertinent part: "Whenever liability to pay compensation is contested by the employer, he shall file with the compensation commission . . . a notice . . . stating . . . the specific grounds on which the right to compensation is contested . . . . If the employer or his legal representative fails to file the notice contesting liability within the time prescribed herein, the employer shall be conclusively presumed to have accepted the compensability of such alleged injury or death and shall have no right thereafter to contest the employee's right to receive compensation on any grounds or the extent of his disability."
On May 29, 1990, the claimant sustained an injury to his left knee in the course of and arising out of his employment with V. J. R. Builders, Inc., the respondent-employer. In its notice of intention to contest liability (Form 43), Travelers stated that it "was not on risk at time of injury." Records maintained in the Hamden office of the Workers' Compensation Commission show no evidence of workers' compensation insurance coverage for the employer as of May 29, 1990. These records show that a policy which became effective on April 28, 1989 either expired by its own terms on April 28, 1990 or was cancelled by a notice received by the Commission on January 8, 1990 and effective January 15, 1990. Those records also show that a new policy was issued to the respondent-employer by the respondent-insurer effective June 19, 1990. Based on this evidence, the trial commissioner concluded that there was a gap in the employer's workers' compensation insurance coverage and that no such insurance coverage was in effect on the date of injury.
After the trial commissioner issued his Finding and Award the Second Injury Fund filed a "Motion to Reopen" pursuant to General Statutes Sec. 31-315. Attached to its motion, the Second Injury Fund presented documents showing that V.J.R. Builders, Inc. had been dissolved by forfeiture on March 30, 1990 and that the responsible party in this matter, therefore, was Vincent Vartuli d/b/a V. J. R. Builders. Thereafter, without hearing from the respondent-employer, the trial commissioner corrected December 12, 1991 Finding and Award and his January 15, 1992 order for payments by the Second Injury Fund to reflect the following: V. J. R. Builders, Inc. was dissolved by forfeiture on March 30, 1990 and thus by operation of law the business continued thereafter as Vincent Vartuli d/b/a V. J. R. Builders, and (2) the caption of the case was amended to show Vincent Vartuli d/b/a V. J. R. Builders as respondent and all references to V. J. R. Builders, Inc. or "respondent" in those prior decision were corrected to be Vincent Vartuli d/b/a V. J. R. Builders.
Vincent Vartuli and V.J.R. Builders, Inc. immediately objected to the corrected Finding and Award by filing a Petition for Review and a Motion to Correct. In its Reasons for Appeal, the employer asserts, inter alia, that the commissioner's corrections were not permitted under General Statutes Sec. 31-315, violated the provisions of General Statutes 33-378 (f), and violated due process requirements of the fourteenth amendment to the United States constitution in that the motion was granted without notice and an opportunity to be heard.
Because we reverse the commissioner's determination with regard to the liability of the respondent-insurer and remand the matter for further proceedings, we will vacate the commissioner's October 29, 1992 corrections as well. The issue of the employer's corporate versus personal identity/liability should be addressed on remand after notice and an opportunity for full hearing.
General Statutes (Rev. to 1989) Sec. 31-348 provides: "Every insurance company writing compensation insurance shall report in writing to the board of commissioners, in accordance with rules by them prescribed, the name of the person or corporation insured, including the state, the day on which the policy becomes effective and the date of its expiration, which report shall be made within one week from the date of the policy. The cancellation of any policy so written and reported shall not become effective until one week after notice of such cancellation has been filed with the commissioner or commissioners with whom such report is filed. Any insurance company violating any provision of this section shall be fined not less than one hundred nor more than one thousand dollars for each offense."
The trial commissioner limited his consideration of the issue of the existence of a workers' compensation insurance policy between the respondents to the evidence recited above. He refused to consider the factual and legal claims of the employer to continued coverage by the insurer through and beyond the date of injury, which proffered evidence the trial commissioner described as follows: "The real issue here is whether there insurance coverage at the date of injury, which is agreed to, namely May 29, 1990. The employer's [first] workers' compensation policy with Travelers . . . had an expiration date by its terms of April 28, 1990. The carrier, it's my understanding, normally gives thirty days premium notice to an insured in advance of the expiration date, but did not do so in this instance until May 9, 1990, that is, after the expiration of the policy, and allowed the employer thirty days to June 9, 1990, to pay the premium and the coverage would then be reinstated retroactive to the April 28, 1990 expiration date. The employer allegedly did not send in the premium until June 12, 1990, which is the postmark allegedly on the date of the envelope containing the check. And it was received by Travelers on . . . June 18, 1990 . . . [which] put into effect a new policy starting June 19, 1990 . . . . The [employer's] attorneys claim that historically the employer was late in paying premiums and that coverage was never before interrupted, that the employer usually had a premium credit as a result of annual workers' compensation audits, and had one for the period here involved as a result of an audit done after the termination date of April 28, 1990." Transcript of November 22, 1991, pp. 14-15.
The employer first contends that by virtue of the inadequacy of its disclaimer of liability contained in the Form 43 filed by Travelers, Travelers was precluded from contesting liability under General Statutes (Rev. to 1989) Sec. 31-297 (b). See generally Menzies v. Fisher, 165 Conn. 338 (1973). We need not determine the adequacy of the disclaimer involved here, however, because the claimant and not the employer is "the only one who would have a right to assert the irreputable presumption of Sec. 31-297 (b) . . ." Colas v. Marriott Food Services, 9 Conn. Workers' Comp. Rev. Op. 86, 89, 939 CRD-7-89-11 (1991). Consequently, the employer lacks standing to raise a claim of preclusion under Sec. 31-297 (b).
The employer next argues that the trial commissioner's jurisdiction to resolve the issue of the existence of a contract of insurance between the respondents is not limited to an examination of the insurance records maintained by the Workers' Compensation Commission pursuant to General Statutes (Rev. to 1989) Sec. 31-348. See footnote 3, supra. We agree.
In Piscitello v. Boscarello, 113 Conn. 128 (1931), our Supreme Court addressed an insurer's claim that no policy with the employer had ever legally come into existence or had been cancelled, notwithstanding the fact that the records maintained by the board of compensation commissioners pursuant to a predecessor to Sec. 31-348 reflected, perhaps erroneously, that a policy was in effect on the date of injury. Describing workers' compensation insurance as "a peculiar type of insurance"; id., 130; the Piscitello court concluded that the record of the insurance policies in existence maintained pursuant to the predecessor to Sec. 31-348 "cannot be open to attack upon the ground that a policy which it (the insurer) has reported to be in effect is not in fact so, either for failure of the insured to accept it when tendered or for other reasons. As regards employees, the insurer is estopped to deny the truth of the formal record so made by it . . . . [S]o long as it remains of record the insurer cannot deny that the policy reported is in effect." Id., 131. In a per curiam decision in Rossini v. Morganti, 127 Conn. 706 (1990), our Supreme Court followed Piscitello and affirmed an award of compensation against an insurer for an August 12, 1938 injury where the insurer cancelled coverage effective August 11, 1938 but, due to a clerk's error, the board of commissioners was notified pursuant to the predecessor to Sec. 31-348 that the cancellation would not be effective until August 18, 1938.
In O'Connell v. Indian Neck General Store, 6 Conn. Workers' Comp. Rev. Op. 42, 530 CRD-3-86 (1988), we concluded that General Statutes Sec. 31-343 does not prevent a trial commissioner from determining under Sec. 31-348 if there was a contract between the employer and the putative insurer. There, we agreed with the insurer that "the Commissioner did have Sec. 31-348 jurisdiction to determine whether or not there existed an insurance policy on the date of this employee's injury . . . . The Commissioner was not called upon to interpret the contract. She had to decide under Sec. 31-348 if there was a contract." Id., 44. Because a notice of cancellation received pursuant to Sec. 31-348 was in effect prior to the injury, we vacated the award against the insurer without remanding for further proceedings.
General Statutes Sec. 31-343 provides: "As between any such injured employee or his dependent and the insurer, every such contract of insurance shall be conclusively presumed to cover the entire liability of the insurer, and no question as to breach of warranty, coverage or misrepresentation by the insured shall be raised by the insurer in any proceeding before the commissioner or on appeal therefrom."
The result in O'Connell appears to support the view taken by the trial commissioner here that a determination of whether an insurance policy was effective on the date of injury is limited to a review of the records created and maintained pursuant Sec. 31-348. It is important to note, however, that no claim appears to have been made in O'Connell that evidence beyond the Sec. 31-348 records should have been considered by the commissioner. In O'Connell, the trial commissioner refused to go as far as reviewing those records and we determined that such a review is authorized. Consequently in O'Connell we had no to address the issue of whether other evidence may be considered when the issue of the existence or non-existence of a contract of workers' compensation insurance is raised. This is the precise issue raised in the present case.
While it is clear from Piscitello and Rossini that an insurer may not resort to evidence extraneous to the records created and maintained pursuant to Sec. 31-348 in order to deny the existence of a policy shown by the records to be effective on the date of injury, those cases do not address the issue of whether an employer may prove the existence of such a contract by resort to such additional evidence. In Witchekowski v. Falls Co., 105 Conn. 737 (1927), our Supreme Court reversed an award of compensation made against an insurer but not against its predecessor on the risk or the employer. The Witchekowski court ordered that the case be returned to the trial commissioner "for the making of an award against the employer alone, or against him and any insurer which may be found to have issued to the employer a policy covering liability for the injured in question." (Emphasis added) Id., 742. This latter directive appears to confer broad authority on the commissioner to assert jurisdiction to resolve the issue of whether an insurance policy covering workers' compensation liability was in effect on the date of injury. In accord with this interpretation, Professor Larson observes: "The general rule appears to be that, when it is ancillary to the determination of the employee's right, the compensation commission has authority to pass upon a question relating to the insurance policy, including . . . cancellation [and] existence or validity of an insurance contract . . . ." 4 A. Larson, Workmen's Compensation Law Sec. 92.41, pp. 17-44 to 17-49. Consistent with our statutory scheme; see Rossini v. Morganti supra, 708; Piscitello v. Boscarello, supra, 130; Professor Larson concludes that this view of the commissioner's authority is "in harmony with the conception of compensation insurance as being something more than an independent contractual matter between insurer and insured." 4 A. Larson, supra, 92.41, pp. 17-52 to 17-54.
We therefore conclude that while the commissioner has no authority to interpret the insurance contract or policy provision, there is authority to decide an employer's claim that a contract of workers' compensation insurance was in existence on the date of injury which is not limited to evidence contained in the records of the Workers' Compensation Commission maintained pursuant to Sec. 31-348. Accordingly, we reverse the decision of the trial commissioner concluding that the respondent employer had no workers compensation insurance coverage on the date of injury and remand the case for further proceedings.
Commissioners Angelo L. dos Santos and Donald H. Doyle, Jr. concur.