STATE OF LOUISIANA COURT OF APPEAL, THIRD CIRCUIT
11-232
DALLAS RICHARD
VERSUS
COASTAL CULVERT & SUPPLY, INC.
********** APPEAL FROM THE OFFICE OF WORKERS’ COMPENSATION - DISTRICT 4 PARISH OF LAFAYETTE, NO. 08-04568 SHARON MORROW, WORKERS’ COMPENSATION JUDGE
**********
ULYSSES GENE THIBODEAUX CHIEF JUDGE
Court composed of Ulysses Gene Thibodeaux, Chief Judge, Marc T. Amy, and Phyllis M. Keaty, Judges.
REVERSED AND RENDERED.
Michael Benny Miller Miller & Miller P. O. Box 1630 Crowley, LA 70527-1630 Telephone: (337) 785-9500 COUNSEL FOR: Plaintiff/Appellant - Dallas Richard
Matthew Robert Richards Johnson, Stiltner & Rahman 2237 S. Acadian Thruway Baton Rouge, LA 70898-8001 Telephone: (225) 231-0521 COUNSEL FOR: Defendant/Appellee - Coastal Culvert & Supply, Inc. THIBODEAUX, Chief Judge.
The claimant, Dallas Richard, appeals the judgment of the Office of
Workers’ Compensation (OWC) denying him penalties and attorney fees for the
employer’s failure to timely pay an amount awarded pursuant to a Consent
Judgment between the parties. Finding that the underpayment at issue was not due
to a condition beyond the employer’s control, we reverse the judgment of the
OWC and render the statutory penalty of $3,000.00 and attorney fees of $3,000.00.
I.
ISSUE
We must decide whether the OWC manifestly erred in denying Mr.
Richard’s motion for penalties and attorney fees due to the employer’s
underpayment of an expense item on a Consent Judgment.
II.
FACTS AND PROCEDURAL HISTORY
Dallas Richard sustained a work-related injury to his left knee on
March 5, 2008, while working for the defendant, Coastal Culvert & Supply, Inc.
(Coastal Culvert).
On April 14, 2009, the parties stipulated to and executed a Consent
Judgment requiring the defendant to pay Mr. Richard expenses of $208.70,
attorney fees of $8,500.00, and a penalty of $6,000.00, all totaling $14,708.70. 1
1 The Consent Judgment also awarded Mr. Richard a supplemental earnings benefit (SEB) of $375.17. While the timely payment of SEB’s was an issue at trial, it was not briefed on appeal. On April 16, 2009, the defendant issued two checks to counsel for
Mr. Richard in the amounts of $8,707.80 and $6,000.00. The total amount
received was $14,707.80, resulting in a ninety-cent shortage, which Mr. Richard
attributes to an underpayment of the expenses of $208.70. The defendant
attributes the shortage to an accidental transposition of the figures ($208.70 versus
$207.80) due to an adjuster oversight.
On August 21, 2009, the defendant issued a check for ninety cents
($0.90) to counsel for Mr. Richard.
A hearing was held on October 16, 2009, on Mr. Richard’s motion for
penalties and attorney fees for various untimely payments of amounts awarded in
the Consent Judgment. On October 14, 2010, the OWC issued a judgment
denying Mr. Richard’s motion for penalties and attorney fees.
III.
STANDARD OF REVIEW
In worker’s compensation cases, the appropriate standard of review to be applied by the appellate court to the OWC’s findings of fact is the “manifest error-clearly wrong” standard. Brown v. Coastal Construction & Engineering, Inc., 96-2705 (La.App. 1 Cir. 11/7/97), 704 So.2d 8, 10 (citing Alexander v. Pellerin Marble & Granite, 93-1698, pp. 5-6 (La. 1/14/94), 630 So.2d 706, 710). Accordingly, the findings of the OWC will not be set aside by a reviewing court unless they are found to be clearly wrong in light of the record viewed in its entirety. Alexander, 630 So.2d at 710.
Angelle Concrete, Inc. v. Sandifer, 06-38, p. 2 (La.App. 3 Cir. 5/24/06), 930 So.2d
1200, 1201-02 (quoting Dean v. Southmark Const., 03-1051, p. 7 (La. 7/6/04), 879
So.2d 112, 117).
2 IV.
LAW AND DISCUSSION
Mr. Richard alleges that “[t]he Worker[s’] Compensation Judge erred
in failing to award a penalty for failure to timely pay the expenses.” The record
reveals that the Consent Judgment was primarily funded on April 16, 2009, two
days after the agreement in open court on April 14, 2009, as indicated above. The
shortage, however, was not paid until August 21, 2009, which was over four
months after the Consent Judgment was executed, and over three months after the
Consent Judgment was signed and mailed by the OWC on May 19, 2009. Mr.
Richard argues that the ninety-cent shortage on the expense payment was paid
after the thirty-day deadline of La.R.S. 23:1201(G), and it is therefore subject to a
$3,000.00 penalty plus reasonable attorney fees and all court costs. Specifically,
Subsection (G) provides:
If any award payable under the terms of a final, nonappealable judgment is not paid within thirty days after it becomes due, there shall be added to such award an amount equal to twenty-four percent thereof or one hundred dollars per day together with reasonable attorney fees, for each calendar day after thirty days it remains unpaid, whichever is greater, which shall be paid at the same time as, and in addition to, such award, unless such nonpayment results from conditions over which the employer had no control. . . . The total one hundred dollar per calendar day penalty provided for in this Subsection shall not exceed three thousand dollars in the aggregate.
La.R.S. 23:1201(G) (emphasis added).
Mr. Richard contends that the only way for the defendant to escape
the $3,000.00 penalty is to show that the “nonpayment results from conditions
over which the employer had no control.” Mr. Richard argues that the defendant’s
allegation that the shortage was an oversight, or a mistake made by the adjuster,
provides no basis for escaping the penalty under La.R.S. 23:1201(G). We agree. 3 The defendant responds that it paid an additional $750.34 on May 5,
2009, which was within the thirty-day period of La.R.S. 23:1201(G), and that it
should receive a credit from that payment to cover the expense shortage. Mr.
Richard, however, correctly points out that the $750.34 was for two weeks of
wage benefits at $375.17 per week, not for the underpayment of the expenses.
Mr. Richard argues that, while the amount of the underpayment was
low, it was still a violation of section (G). He cites Guillory v. Bofinger’s Tree
Service, 06-86 (La.App. 1 Cir. 11/3/06), 950 So.2d 682, where the court held that
penalties and attorney fees were due on an underpayment of thirty-nine cents
($0.39). In Guillory, the underpayment was due to the employer’s use of the
wrong rate in calculating a mileage expense payment, an error that could have
serious consequences.
Here, while we recognize that the underpayment of ninety cents
seems like an insubstantial amount, the penalty assessed in La.R.S. 23:1201(G) is
mandatory, and the statute makes no distinction between small infractions versus
large infractions where the employer fails to pay the full amount of a judgment.
As indicated, in order to avoid a penalty under La.R.S. 23:1201(G), the employer
must show that the underpayment is due to a condition beyond the employer’s
control. A clerical error or adjuster’s oversight is not a condition “beyond the
employer’s control,” which is the standard to which we are confined in this case.
If the standard under La.R.S. 23:1201(G) were “arbitrary and capricious,” as it is
under La.R.S. 23:1201(I), a different result may have been warranted.2
2 See King v. Travelers Ins. Co., 553 So.2d 1072 (La.App. 3 Cir. 1989), writ denied, 558 So.2d 570 (La.1990).
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STATE OF LOUISIANA COURT OF APPEAL, THIRD CIRCUIT
11-232
DALLAS RICHARD
VERSUS
COASTAL CULVERT & SUPPLY, INC.
********** APPEAL FROM THE OFFICE OF WORKERS’ COMPENSATION - DISTRICT 4 PARISH OF LAFAYETTE, NO. 08-04568 SHARON MORROW, WORKERS’ COMPENSATION JUDGE
**********
ULYSSES GENE THIBODEAUX CHIEF JUDGE
Court composed of Ulysses Gene Thibodeaux, Chief Judge, Marc T. Amy, and Phyllis M. Keaty, Judges.
REVERSED AND RENDERED.
Michael Benny Miller Miller & Miller P. O. Box 1630 Crowley, LA 70527-1630 Telephone: (337) 785-9500 COUNSEL FOR: Plaintiff/Appellant - Dallas Richard
Matthew Robert Richards Johnson, Stiltner & Rahman 2237 S. Acadian Thruway Baton Rouge, LA 70898-8001 Telephone: (225) 231-0521 COUNSEL FOR: Defendant/Appellee - Coastal Culvert & Supply, Inc. THIBODEAUX, Chief Judge.
The claimant, Dallas Richard, appeals the judgment of the Office of
Workers’ Compensation (OWC) denying him penalties and attorney fees for the
employer’s failure to timely pay an amount awarded pursuant to a Consent
Judgment between the parties. Finding that the underpayment at issue was not due
to a condition beyond the employer’s control, we reverse the judgment of the
OWC and render the statutory penalty of $3,000.00 and attorney fees of $3,000.00.
I.
ISSUE
We must decide whether the OWC manifestly erred in denying Mr.
Richard’s motion for penalties and attorney fees due to the employer’s
underpayment of an expense item on a Consent Judgment.
II.
FACTS AND PROCEDURAL HISTORY
Dallas Richard sustained a work-related injury to his left knee on
March 5, 2008, while working for the defendant, Coastal Culvert & Supply, Inc.
(Coastal Culvert).
On April 14, 2009, the parties stipulated to and executed a Consent
Judgment requiring the defendant to pay Mr. Richard expenses of $208.70,
attorney fees of $8,500.00, and a penalty of $6,000.00, all totaling $14,708.70. 1
1 The Consent Judgment also awarded Mr. Richard a supplemental earnings benefit (SEB) of $375.17. While the timely payment of SEB’s was an issue at trial, it was not briefed on appeal. On April 16, 2009, the defendant issued two checks to counsel for
Mr. Richard in the amounts of $8,707.80 and $6,000.00. The total amount
received was $14,707.80, resulting in a ninety-cent shortage, which Mr. Richard
attributes to an underpayment of the expenses of $208.70. The defendant
attributes the shortage to an accidental transposition of the figures ($208.70 versus
$207.80) due to an adjuster oversight.
On August 21, 2009, the defendant issued a check for ninety cents
($0.90) to counsel for Mr. Richard.
A hearing was held on October 16, 2009, on Mr. Richard’s motion for
penalties and attorney fees for various untimely payments of amounts awarded in
the Consent Judgment. On October 14, 2010, the OWC issued a judgment
denying Mr. Richard’s motion for penalties and attorney fees.
III.
STANDARD OF REVIEW
In worker’s compensation cases, the appropriate standard of review to be applied by the appellate court to the OWC’s findings of fact is the “manifest error-clearly wrong” standard. Brown v. Coastal Construction & Engineering, Inc., 96-2705 (La.App. 1 Cir. 11/7/97), 704 So.2d 8, 10 (citing Alexander v. Pellerin Marble & Granite, 93-1698, pp. 5-6 (La. 1/14/94), 630 So.2d 706, 710). Accordingly, the findings of the OWC will not be set aside by a reviewing court unless they are found to be clearly wrong in light of the record viewed in its entirety. Alexander, 630 So.2d at 710.
Angelle Concrete, Inc. v. Sandifer, 06-38, p. 2 (La.App. 3 Cir. 5/24/06), 930 So.2d
1200, 1201-02 (quoting Dean v. Southmark Const., 03-1051, p. 7 (La. 7/6/04), 879
So.2d 112, 117).
2 IV.
LAW AND DISCUSSION
Mr. Richard alleges that “[t]he Worker[s’] Compensation Judge erred
in failing to award a penalty for failure to timely pay the expenses.” The record
reveals that the Consent Judgment was primarily funded on April 16, 2009, two
days after the agreement in open court on April 14, 2009, as indicated above. The
shortage, however, was not paid until August 21, 2009, which was over four
months after the Consent Judgment was executed, and over three months after the
Consent Judgment was signed and mailed by the OWC on May 19, 2009. Mr.
Richard argues that the ninety-cent shortage on the expense payment was paid
after the thirty-day deadline of La.R.S. 23:1201(G), and it is therefore subject to a
$3,000.00 penalty plus reasonable attorney fees and all court costs. Specifically,
Subsection (G) provides:
If any award payable under the terms of a final, nonappealable judgment is not paid within thirty days after it becomes due, there shall be added to such award an amount equal to twenty-four percent thereof or one hundred dollars per day together with reasonable attorney fees, for each calendar day after thirty days it remains unpaid, whichever is greater, which shall be paid at the same time as, and in addition to, such award, unless such nonpayment results from conditions over which the employer had no control. . . . The total one hundred dollar per calendar day penalty provided for in this Subsection shall not exceed three thousand dollars in the aggregate.
La.R.S. 23:1201(G) (emphasis added).
Mr. Richard contends that the only way for the defendant to escape
the $3,000.00 penalty is to show that the “nonpayment results from conditions
over which the employer had no control.” Mr. Richard argues that the defendant’s
allegation that the shortage was an oversight, or a mistake made by the adjuster,
provides no basis for escaping the penalty under La.R.S. 23:1201(G). We agree. 3 The defendant responds that it paid an additional $750.34 on May 5,
2009, which was within the thirty-day period of La.R.S. 23:1201(G), and that it
should receive a credit from that payment to cover the expense shortage. Mr.
Richard, however, correctly points out that the $750.34 was for two weeks of
wage benefits at $375.17 per week, not for the underpayment of the expenses.
Mr. Richard argues that, while the amount of the underpayment was
low, it was still a violation of section (G). He cites Guillory v. Bofinger’s Tree
Service, 06-86 (La.App. 1 Cir. 11/3/06), 950 So.2d 682, where the court held that
penalties and attorney fees were due on an underpayment of thirty-nine cents
($0.39). In Guillory, the underpayment was due to the employer’s use of the
wrong rate in calculating a mileage expense payment, an error that could have
serious consequences.
Here, while we recognize that the underpayment of ninety cents
seems like an insubstantial amount, the penalty assessed in La.R.S. 23:1201(G) is
mandatory, and the statute makes no distinction between small infractions versus
large infractions where the employer fails to pay the full amount of a judgment.
As indicated, in order to avoid a penalty under La.R.S. 23:1201(G), the employer
must show that the underpayment is due to a condition beyond the employer’s
control. A clerical error or adjuster’s oversight is not a condition “beyond the
employer’s control,” which is the standard to which we are confined in this case.
If the standard under La.R.S. 23:1201(G) were “arbitrary and capricious,” as it is
under La.R.S. 23:1201(I), a different result may have been warranted.2
2 See King v. Travelers Ins. Co., 553 So.2d 1072 (La.App. 3 Cir. 1989), writ denied, 558 So.2d 570 (La.1990). There, under an arbitrary and capricious standard, we found that the defendant, who voluntarily corrected its clerical error by immediately paying an omitted medical bill upon notice of the error, did not proceed with an “attitude of indifference,” and we affirmed dismissal of the plaintiff’s suit. Id. at 1074. 4 As previously indicated, the Consent Judgment in this case awarding
the expenses of $208.70 was agreed to by the parties in open court on April 14,
2009, and it was signed and mailed by the OWC on May 19, 2009. On April 16,
2009, the defendant issued checks totaling $14,707.80 for payment of a penalty,
for attorney fees, and for the expenses awarded in the Consent Judgment. These
payments were ninety cents short, and the shortage was not corrected until August
21, 2009, several months after the thirty-day deadline mandated by La.R.S.
23:1201(G).
The subsequent hearings on Mr. Richard’s motion, and the post-
hearing briefs, dealt primarily with the timeliness of the SEB payments under
La.R.S. 23:1201(F) and (G), and with issues relating to Mr. Richard’s other injury
and a second insurer, but also addressed the underpayment of the expenses
awarded. The oral ruling on Mr. Richard’s motion, however, stated merely that no
penalties were due under La.R.S. 23:1201(F) or (G), and no reasons were
articulated to distinguish the SEB payments from the underpayment of the
expenses. Likewise, the October 14, 2010, judgment being appealed stated only
that Mr. Richard’s “Motion for Penalties and Attorney’s fees” was denied.
“The decision to assess a defendant with penalties and attorney’s fees
is essentially a question of fact, which will not be disturbed absent manifest error.”
Batiste v. Crowley Mills/Farley, 98-1784, p. 3 (La.App. 3 Cir. 3/31/99), 735 So.2d
740, 742 (citing Culbert v. ConAgra, Inc., 98-238 (La.App. 3 Cir. 6/3/98), 716
So.2d 43, writ denied, 98-1817 (La. 10/16/98), 726 So.2d 908). Because the OWC
did not find that the underpayment of the expense item was a condition beyond the
employer’s control, and the record does not implicitly support such a finding, the
OWC was manifestly erroneous in its denial of Mr. Richard’s motion for penalties
and attorney fees. 5 V.
CONCLUSION
Accordingly, we reverse the OWC’s denial of penalties and attorney
fees on the underpayment of the expense item and award the $3,000.00 penalty
and attorney fees in the amount of $3,000.00 for work at the trial and appellate
levels as mandated by La.R.S. 23:1201(G). Costs of this appeal are assessed to the
defendant, Coastal Culvert.