Opinion
W.C. No. 3-987-235.
May 2, 2008.
FINAL ORDER
The respondents seek review of an order issued by the Director of the Division of Workers' Compensation (Director) dated December 19, 2007 that granted the claimant's lump sum request. We reverse.
The pertinent facts are not in dispute. The claimant was injured in a compensable accident on June 1, 1990 and was awarded permanent and total disability (PTD) benefits. The claimant had sought and received a payment in lump sum of $26,292 that was the maximum available at the time. The section of the Workers' Compensation Act that dealt with lump sums was amended by the General Assembly in 2007 and the maximum aggregate lump sum increased to $60,000. The claimant thereafter requested an additional lump sum payment of $33,708 to bring the aggregate total of lump sum payments to $60,000. The Director granted the claimant's request in a Lump Sum Award Order dated December 19, 2007.
The respondents appeal, principally relying on Eight Thousand West Corp. v. Stewart, 37 Colo. App. 372, 546 P.2d 1281 (1976). Eight Thousand West generally holds that the rights and liabilities of the parties are determined by the statute in effect at the time of claimant's injury.
The Director found that the 2007 amendment did not impair the respondents' substantive rights because they would pay the same amount of benefits as they would have prior to the change. The Director notes that the claimant's ongoing PTD benefits are reduced at a rate established by the legislature and based on the claimant's life expectancy so that increasing the total amount the claimant can receive in a lump sum does not increase the benefits paid to a claimant and does not affect the liability incurred by the respondents. The Director therefore determined that because the increase in the aggregate lump sum amount available was procedural the amendment was applicable to all workers' compensation cases pending at the time the new statute became effective. The Director generally cited Kinninger v. ICAO, 759 P.2d 766 (Colo.App. 1988).
The Director also cited American Compensation Insurance Company v. McBride, 107 P.3d 973 (Colo.App. 2004) and Division of Child Support Enforcement v. Industrial Claim Appeals Office, 109 P.3d 1042 (Colo.App. 2005) in support of his determination that the 2007 amendment was procedural and not substantive. The Director noted that insofar as Eight Thousand West may be considered inconsistent with his order he determined that the more recent cases construing the payment provisions of the Worker's Compensation Act cited by him are better reasoned and more persuasive and, therefore, applicable to this case.
In American Compensation Insurance Company v. McBride, the issue was whether a statutory amendment authorizing garnishment of permanent partial disability workers' compensation benefits to satisfy claimant's outstanding child support obligation should be applied retroactively. The court found that the statute should be applied retroactively. The court viewed the statutory amendment was a remedial change creating new administrative remedy to satisfy the claimant's preexisting child support obligation and so did not violate the prohibition against retrospective legislation. In Division of Child Support Enforcement v. Industrial Claim Appeals Office, the issue was whether a new statute authorizing attachment of settlement proceeds for unpaid child support was procedural and could be applied retroactively. The court found that it should be applied retroactively. The court was persuaded by the American Compensation Insurance Company v. McBride analysis and concluded that it was equally applicable to the statutory change and circumstances involving the statute it was reviewing. The court found in both American Compensation Insurance Company v. McBride and Division of Child Support Enforcement v. Industrial Claim Appeals Office that the General Assembly intended that the amendments would be applied retroactively. In contrast, the court in Eight Thousand West found that the General Assembly had not intended the amendments to be applied retroactively in a case involving a statutory change increasing the maximum lump sum award, virtually identical to the present statutory amendment under consideration.
In Eight Thousand West, the claimant was awarded PTD benefits and submitted three requests for compensation in a lump sum. These requests were granted. In 1975, the claimant made an additional request for a lump sum payment, which would exceed the statutory limit for PTD lump sum payments in effect at the time of the injury, but would not exceed the amount authorized by a post-injury amendment to the statute. The court held that, in the absence of a specific legislative directive, it would not give retrospective effect to an amendment so as to alter "civil liabilities already incurred." The increase in the maximum amount available for lump sum payment that occurred in 1971 and discussed by the court in Eight Thousand West was the same kind of increase that occurred in 2007 and is involved in the present case. Therefore, in our view Eight Thousand West may not be distinguished from the present case.
Section 8-43-406, in S.B. 07-258, was amended effective May 30, 2007 to increase the aggregate total of benefits received in lump sum to $60,000. Colo. Sess. Laws 2007, ch 341 at 1475, C.R.S. 2007. Senate Bill 07-258 does not contain any express legislative statement concerning the date of applicability and the amendment was made without any express regard to the date of injury. The legislature is presumed to be aware of the judicial precedent in an area of law when it legislates in that area. See Vaughan v. McMinn 945 P.2d 404 (Colo. 1997); Resolution Trust Corp. v. Heiserman, 898 P.2d 1049, 1054 (Colo. 1995). In addition, the legislature is presumed to adopt the construction which prior judicial decisions have placed on particular language when such language is employed in subsequent legislation. See Vaughan v. McMinn supra; People v. Cooke, 150 Colo. 52, 62, 370 P.2d 896, 901 (1962). Therefore, the general assembly here was presumably aware of the interpretation made by the court in Eight Thousand West that absent an express legislative provision, the repeal of a statute will not operate retroactively to modify vested rights or liabilities. Indeed, the legislature has incorporated into the Colorado statutes the principle that "[a] statute is presumed to be prospective in operation." Section 2-4-202, C.R.S. 2007. See also Taylor v. Public Employees' Retirement Association, 189 Colo. 486, 542 P.2d 383 (1975) (amendment to a statute is not retroactively applied if the amendment covers the same subject matter as the original statute and if the person claiming under the amendment had a continuing status under the original statute and the amendment); Kirby of Southeast Denver v. Industrial Commission, 732 P.2d 1232 (Colo.App. 1986) (amendment not given retroactive application unless a contrary result is clearly manifested). The General Assembly in 2007 chose to increase the aggregate total of benefits that could be received in lump sum in the same manner that they had in 1971 preceding the decision in Eight Thousand West. Therefore, the Director's determination, which is contrary to the holding in Eight Thousand West, must be reversed and the order that the respondents pay additional amounts in lump sum is set aside. Section 8-43-301(8), C.R.S. 2007.
IT IS THEREFORE ORDERED that the ALJ's order issued December 19, 2007 is reversed and the award of $33,708 in additional lump sum benefits is set aside.
INDUSTRIAL CLAIM APPEALS PANEL
_____ John D. Baird
_____ Thomas Schrant
STEPHANIE NELSON, VICTORVILLE, CA, (Claimant).
WESTERN GUARANTY FUND, Attn: MICHAEL KRAMISH, DENVER, CO, (Insurer).
THE LAW OFFICE OF STEPHANIE J STEVENSON, PC, Attn: STEPHANIE J STEVENSON, ESQ., COLORADO SPRINGS, CO, (For Claimant).
MCELROY DEUTSCH, MULVANEY CARPENTER, Attn: TOM KANAN, ESQ., DENVER, CO, (For Respondents).
DIVISION OF WORKERS' COMPENSATION, Attn: DIRECTOR, DENVER, CO, (Other Party).