Opinion
C.A. No. OOA-01-002 HDR.
Submitted: July 26, 2000.
Decided: August 7, 2000.
Upon Employer's Appeal from a Decision of the Industrial Accident Board REVERSED and REMANDED.
Danielle K. Yearick, Esq., of Tybout, Redfearn Pell, Wilmington, Delaware, for Employer Below-Appellant.
John J. Schmittinger, Esq., and Walt F. Schmittinger, Esq., of Schmittinger Rodriguez, P.A., Dover, Delaware, for Claimant Below-Appellee.
OPINION I. BACKGROUND
In the present appeal, the State challenges the propriety of certain worker's compensation benefits that the Industrial Accident Board (the "Board") awarded to Dominique Brown, a former State employee. The Board awarded Brown total disability benefits from January 7, 1998, until September 7, 1998. Before the Board granted this award, the State had previously paid Brown his full wages pursuant to 29 Del. C. § 5933(a) for the period between January 7, 1998 and March 10, 1998. According to the State, the Board's award of total disability benefits provided Brown with an unjustifiable double recovery. The State argues that it is entitled to a set-off for the full wages it paid Brown from January 7, 1998, to March 10, 1998. I agree and reverse the Board's award of total disability benefits.
Brown v. State, I.A.B. No. 1123717 at 17 (Oct. 1, 1998).
Brown worked as a corrections officer for the Department of Corrections of the State of Delaware from 1989 until 1997. In August of 1997, Brown purportedly witnessed an unprovoked, brutal attack on two inmates by a fellow guard. One of the inmates was beaten so badly that he became incontinent. After this event, Brown became extremely distraught and reported his observations to the Department of Internal Affairs ("DIA"). When Brown's co-workers learned that he had reported the incident, they began to ostracize and intensely criticize him. A hearing officer advised him to "watch his back," and some of the other guards intimated that they would not give him any assistance if he needed it. During a confrontation, Brown reached out and placed his hand on another guard's chest. This guard later filed a criminal complaint of offensive touching against Brown.
Brown sought professional counseling to help him deal with the psychological effect that these incidents had on him. He also turned to religion for solace. Particularly, he became interested in biblical passages concerning prophets. In an attempt to make sense of what had happened to him, Brown began to think of himself as a prophet. Although Brown did not really believe he was a prophet, he tried to explain his decision to report the incident to DIA in terms that referred to scripture and presented him as a prophet. Brown wrote a letter to the Department of Corrections to explain why he had reported the incident. The letter quoted scripture and was signed by Brown as a prophet. Because of the content of this letter, the State referred Brown to a psychologist.
The State later placed Brown on leave because of the offensive touching charge. When this leave ended, as a result of his counselors' recommendations and his employer's concerns, the State temporarily suspended him with full pay from January, 1998, until March, 1998. Then, on March 10, 1998, the State terminated Brown's employment.
On April 29, 1998, Brown filed with the Board a Petition to Determine Compensation Due, seeking total disability benefits. Before the Board heard this petition, Brown tried unsuccessfully to find other employment. The State again paid Brown his full wages from May 7, 1998 to August 31, 1998, in the form of disability pension payments pursuant to 29 Del. C. § 5524.
These disability pension payments are not at issue in the present appeal.
The Board held a hearing on Brown's petition on September 17, 1998. The Board heard testimony from Brown and from experts for both sides. The State's expert testified that Brown's psychiatric problems resulted from a pre-existing mental disorder unrelated to his work. Brown's expert countered this testimony by pointing out that Brown had functioned at his job without incident for eight years, and that his symptoms occurred as a result of a tragic occurrence at work. Brown himself admitted in his testimony that he had received his full salary from January 7, 1998 through March 10, 1998.
In an opinion dated October 1, 1998, the Board determined that Brown was totally disabled from January 7, 1998 until September 7, 1998 Accordingly, the Board ordered the State to pay Brown total disability benefits for that time period.
Brown v. State, I.A.B. No. 1123717 at 17 (Oct. 1, 1998).
Id.
On October 7, 1998, the State moved for re-argument, asserting that it was entitled to a set-off for duplicative payments. Brown opposed this motion, because he claimed that the State had not raised this issue at the hearing. Brown also maintained that the Board lacked the authority to award a set-off. The Board ordered additional briefing, and specifically requested the parties to address the impact of 29 Del. C. § 5933 on the issue of a set-off.
On October 7, 1999, the Board denied the State's motion for reargument. The Board reasoned that the State was not entitled to a set-off because the relevant statute, 29 Del. C. § 5933, does not provide for it, and because the Board lacks the authority to grant a set-off. The State then filed this timely appeal.
Brown v. State, I.A.B. No. 1123717 (Oct. 7, 1999) (ORDER).
Id. at 6.
II. STANDARD OF REVIEW
In appeals from the Industrial Accident Board, the Superior Court must limit its scope of review to correcting errors of law and determining whether substantial evidence exists in the record to support the Board's findings of fact and conclusions of law. "Substantial evidence means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." It is more than a scintilla of evidence, but less than a preponderance. On appeal, this Court may neither reweigh the evidence, determine questions of credibility, nor make its own factual findings. The Court must give deference to "the experience and specialized competence of the Board" and must take into account the purposes of the Worker's Compensation Act.
Histed v. E.I. DuPont de Nemours Co., Del. Supr., 621 A.2d 340, 342 (1993); Johnson v. Chrysler Corp., Del. Supr., 213 A.2d 64, 66 (1965).
Olney v. Cooch, Del. Supr., 425 A.2d 610, 614 (1981).
Id.
ILC of Dover, Inc. v. Kelley, Del. Super., C.A. No. 99A-02-002, 1999 WL 1427805 at *1, Witham, J. (Nov. 22, 1999).
Histed, 621 A.2d at 342.
III. DISCUSSION
The State raises five issues on appeal. First, the State argues that, although it raised the issue of double payments in its motion for reargument, the Board failed to address this issue. Second, the State claims that the Board erroneously interpreted 29 Del. C. § 5933 to allow a double recovery. Third, the State asserts that the Board does, in fact, have the authority to provide a set-off. Fourth, the State alleges that, where the claimant has not suffered a wage loss, the Board may not award additional benefits. And finally, the State contends that it properly presented to the Board the issue of double payment, notwithstanding the Board's findings to the contrary.Brown responds by arguing that the State never argued the issue of double as a defense, either during or prior to the original hearing as evidenced by the contents of the petition, the pre-trial memorandum, and the State's opening and closing arguments. Therefore, according to Brown, the State waived this defense. Further, Brown argues that he was not awarded a double payment at all, but rather, a payment of the statutory benefits to which a worker's compensation claimant is entitled.
Worker's Compensation law has a two-fold purpose: 1) it provides compensation for work-related injuries, and 2) it relieves employers and their employees of the expenses associated with civil litigation. When determining if a legitimate claim for compensation exists, the relevant inquiry is whether there was a work-connected injury. Once the existence of a work-related injury has been established, the next step is to ascertain the type of benefits due the employee. "Benefits for physical injury . . . are of two kinds: wage-loss payments based on the concept of disability; and payment of hospital and medical expenses occasioned by any work-connected injury, regardless of wage loss or disability." When a work-related injury results in total disability, the employer must pay during the continuance of the total disability compensation equal to 66 2/3% of the injured employee's wages. In addition, pursuant to 29 Del. C. § 5933, State employees who qualify for worker's compensation benefits are also entitled to salary supplementation for up to twelve months. 29 Del. C. § 5933 effectively enables State employees to receive full wages for up to twelve months of the period in which they are collecting worker's compensation benefits.
Lord v. Souder, Del. Supr., No. 58, 1999, 2000 WL 351391 at *8, Walsh, J. (March 24, 2000); Guy J. Johnson Transportation Co. v. Dunkle, Del. Supr., 541 A.2d 551, 552 (1988).
1 Larson's Workmen's Compensation Law § 1.03 (1999).
4 Larson's Workmen's Compensation Law § 57.10 (1999).
29 Del. C. § 5933 provides, in pertinent part:
(a). . . . Whenever an officer or employee of the State, including those exempt from the classified service, qualifies for workmen's compensation benefits, such officer or employee, for a period not to exceed 3 months from the date such compensation begins, shall not be charged sick leave and shall receive from the State the difference, if any, between the total of: (1) The amount of such compensation, (2) any disability benefits received under the Federal Social Security Act, and (3) any other employer supported disability program, and the amount of wages to which the officer or employee is entitled on the date such compensation begins, provided the injury or disease for which such compensation is paid is not the direct result of such officer or employee's misconduct and occurs during a period of employment for which the employee is entitled to receive wages . . . .
(c) Notwithstanding subsection (a) of this section, the 3-month limitation shall not apply to any employee injured while performing a hazardous duty assignment and whose injury or injuries arose out of and in the course of performing hazardous duty; provided, however, such employee shall be entitled to the benefits of this section for not more than 12 months. Hazardous duty assignments shall include, but not be limited to:
(1) Employees otherwise qualified who are employed by the Department of Corrections . . . .
See id.; see also 29 Del. C. § 5933.
The issues raised by the State, while divided into five separate components, can essentially be reduced to three. These three issues are: 1) whether the State waived the defense of a set-off for double payment; 2) whether the relevant statutory provisions give the Board the authority to grant a set-off; and 3) whether the State is entitled to a set-off for the full wages it paid Brown from January 7, 1998, to March 10, 1998. I find that the State did not waive the defense of a set-off, because the State questioned Brown regarding this issue at the hearing, and Brown testified that he received his full salary from January 7, 1998 through March 10, 1998.
19 Del. C. § 2301A(i) gives the Board jurisdiction over all disputes regarding the compensation owed to employees injured in industrial accidents. Pursuant to 19 Del. C. § 2345, if the employer and employee fail to reach an agreement concerning the amount and method of compensation, the Board has the duty to hear and determine the matter. These statutes, together with the long line of precedent sustaining the Board's power to order credits and reimbursement as a means of avoiding double recovery, lead me to conclude that the Board has the authority to grant a set-off.
19 Del. C. § 2301A(i) provides:
(i) The Board shall have jurisdiction over cases arising under Part II of this title and shall hear disputes as to compensation to be paid under Part II of this title. The Board may promulgate its own rules of procedure for carrying out its duties consistent with Part II of this title and the provisions of the Administrative Procedures Act. Such rules shall be for the purpose of securing the just, speedy and inexpensive determination of every petition pursuant to Part II of this title. The rules shall not abridge, enlarge or modify any substantive right of any party and they shall preserve the rights of parties as declared by Part II of this title.
Bowen v. Rothwell's Garage, Inc., Del. Super., C.A. No. 85A-AP-1, 1986 WL 9020 at *1, Chandler, J. (Aug. 6, 1986) (Mem. Op.). 19 Del. C. § 2345 provides:
If the employer and employee, or the employee's dependents in the case of the employee's death, fail to reach agreement in regard to compensation under this chapter, or if after they reach such an agreement the Board shall refuse to approve the same, either party may notify the Department of the facts and the Department shall thereupon notice the time and place of hearing which shall be served on all parties in interest personally or by certified mail. The Board or a hearing officer with consent of the parties shall hear and determine the matter in accordance with the facts and the law and state its conclusions of fact and rulings of law.
Dunkle, 541 A.2d 551; Hall v. Chrysler Corp., Del. Super., C.A. No. 96A-03-003, Gebelein, J. (Sept. 20, 1996) (Mem. Op.), aff'd, Del. Supr., 692 A.2d 412 (Feb. 19, 1997); Bowen, C.A. No. 85A-AP-1, 1986 WL 9020; Briggs v. DuPont, Del. Super., C.A. No. 97A-01-008, 1998 WL 110037, Lee, J. (Jan. 20, 1998).
Both the Supreme Court and the Superior Court have previously addressed the issue of set-offs in a variety of contexts. Additionally, the legislature has expressly addressed the concept of set-offs in the Worker's Compensation Act. Specifically, the Act precludes an employee compensated for wage losses through worker's compensation from receiving compensation for the same losses from a third-party tortfeasor. Instead, the employee must first use "[a]ny recovery against the third party for damages resulting from personal injuries or death only, after deducting expenses of recovery" to "reimburse the employer or its workers' compensation insurance carrier for any amounts paid or payable under the Worker's Compensation Act to date of recovery " The balance is then paid to the employee or his or her dependents or personal representative and is "treated as an advance payment by the employer on account of any future payment of compensation benefits. . . ." However, an exception exists in which the set-off provisions of 19 Del. C. § 2363(e) do not apply: Set-offs are prohibited if the second type of benefits "arises from a source which exists by reason of the employee's payment of a separate consideration."
See Brooks v. Chrysler Corp., Del. Super., 405 A.2d 151 (1979) (discussing setoffs between worker's compensation benefits and unemployment compensation benefits); see also Washington v. Christiana Service Co., Del. Super., C.A. No. 90A-AP-9, Barron, J. (Oct. 12, 1990) (Mem. Op.), appeal dismissed, Christiana Service Co. v. Washington, Del. Supr., 590 A.2d 502 (1991) (discussing set-offs between worker's compensation benefits and benefits provided for by federal legislation).
Id.
State v. Calhoun, Del. Supr., 634 A.2d 335, 337 (1993).
In State v. Calhoun, the claimant was an injured State employee who sought to recover both worker's compensation benefits and retirement disability benefits. The State claimed that it was entitled to offset the claimant's disability retirement benefits against his worker's compensation benefits. The Delaware Supreme Court held that the claimant had a right to receive both types of benefits, and that a set-off was not available. The Court reasoned that the State Employees' Pension Plan and the Worker's Compensation Act were to be liberally construed, and that neither Act expressly required disability retirement benefits to be offset against worker's compensation benefits. Furthermore, the Court pointed out that the claimant's right to collect disability retirement benefits was contractual in nature and was based on his participation in and contributions to the State Employees' Pension Plan. According to the Court, the claimant had a vested right to these retirement disability benefits, and granting a set-off would work a forfeiture of these benefits by implication. Finally, the Court added that, even with the receipt of both worker's compensation benefits and disability retirement benefits, the claimant would still not receive the full amount of wages earned prior to his accident. Similarly, Adams v. Delmarva Power Light Co. held that an insurance carrier was not entitled to credit the proceeds from the claimant's underinsured motorist policy against the claimants' worker's compensation benefits, because the claimant had paid independent consideration for additional coverage as protection against injury by an underinsured motorist. Calhoun and Adams are distinguishable from the present case, because, unlike the claimants in Calhoun and Adams, Brown did not contribute to or pay independent consideration for the wages he received from the State.
Id. at 336-37.
Id. at 336.
Id. at 338.
29 Del. C. Ch. 55.
19 Del. C. Ch. 23.
Calhoun, 634 A.2d at 337.
Id. at 338.
Id.
Id.
Del. Supr., 575 A.2d 1103, 1104, 1106 (1990).
In Guy .J. Johnson Transportation Co. v. Dunkle, a case more analogous to the present action, the employer argued that he had a right to credit against an award of medical expenses the payments previously made to the claimant through employer-provided medical insurance. The Delaware Supreme Court agreed that the employer was entitled to such a credit. The Court declared that, although the Worker's Compensation Act "contemplates full compensation, it is not intended to permit more than one recovery for a single loss." The Court refused to accept the contention that there could be no set-off in the absence of express legislative authority permitting subrogation. Instead, the Court held that no statutory authority was necessary to deny recovery for losses never incurred or expenses never sustained, because "[t]o hold otherwise would permit a double recovery or a windfall to the employee." Dunkle "stands for the proposition that an employee cannot secure double recovery for a single loss where both sources of recovery emanate from the employer."
Id.
Id. at 553.
Id.
Id.
Calhoun, 634 A.2d at 338.
The cases most factually similar to the present one, and therefore controlling, are those in which an employee received an award from the Board, but had previously obtained employer-provided benefits for the same injury. See Dunkle, 541 A.2d 551 (allowing a set-off between medical expenses and employer-provided medical insurance); see also Hall, Del. Super., C.A. No. 96A-03-003 (permitting a set-off between total disability benefits and amounts paid to the claimant through an employer-provided sickness and accident insurance plan); and Bowen, C . A. No. 85A-AP-1, 1986 WL 9020 (granting a set-off between worker's compensation benefits and sums paid to the employee under the employer's motor vehicle insurance policy). These cases demonstrate that a set-off is proper when the receipt of employer-supplied benefits has prevented the employee from suffering a wage loss. Refusing to permit a set-off under these circumstances "would allow [the] employee to enjoy a windfall, at the employer's expense, from a double recovery for the same loss."
Briggs, C.A. No. 97A-01-008, 1998 WL 110037 at *8.
Id.
IV. CONCLUSION
In the present case, Brown has not experienced any loss of wages. He provided undisputed testimony at the Board hearing that the State paid him full wages from January 7, 1998, until March 10, 1998. Consequently, I hold that he is not entitled to a double recovery for the same injury. The Board not only had the authority to grant a set-off in the instant case, it had the duty to do so. The Board's award of total disability benefits is, therefore, REVERSED and the matter is REMANDED for further proceedings and determinations consistent with this opinion.IT IS SO ORDERED.
/s/_____________________________ President Judge