Lizdo v. Gentec Equipment

74 S.W.3d 703, 2002 Ky. LEXIS 92, 2002 WL 1000899
Kentucky Supreme Court·Decided May 16, 2002·No. No. 2001-SC-0139-WC·Published·Cited by 6 cases

Opinion

OPINION OF THE COURT

REVERSING AND REMANDING

The Court of Appeals has reversed the Workers’ Compensation Board (Board) and reinstated an Administrative Law Judge’s (ALJ’s) decision to the effect that because the employer complied with KRS 342.040(1), the failure of the Commissioner of the Department of Workers’ Claims (Commissioner) to notify the claimant of his right to prosecute did not toll the period of limitations. We have concluded, however, that a finding that the employer complied with KRS 342.040(1) was unreasonable under the evidence. Therefore, we reverse.

The claimant alleged that on July 25, 1996, he burned his left upper arm while welding a sink, after which he was hospitalized for a period of time. He received temporary, total disability (TTD) benefits through August 18, 1996, and later returned to work. On September 3, 1996, a forklift blade fell on his right foot, crushing it. His employer paid TTD benefits for that injury through October 15, 1996, and the claimant again returned to work. Shortly thereafter he resigned and accepted employment at a higher wage with another company. On January 27, 1999, he filed a workers’ compensation claim against the employer and the Special Fund, maintaining that the burn injury continued to cause disabling pain. The Form 101 claim indicates that it was signed by the claimant on October 6, 1998.

Noting that the claim was filed more than two years after the last TTD payment, the defendants asserted a limitations defense and maintained that it would apply to either injury. The record contains a copy of a handwritten Form SF-3A for each termination of TTD. Although each copy is stamped as having been electronically filed, the stamp refers to a corporation, not the Department of Workers’ Claims (Department). The record contains no certification by the Department that the form was actually filed and no proof that the Commissioner notified the claimant of his right to prosecute a claim or of the applicable. period of limitations. The claimant testified that he did not re[705] ceive such a letter. Relying upon Ingersoll-Rand v. Whittaker, Ky.App., 883 S.W.2d 514 (1994), he asserted that the period of limitations was tolled and, therefore, that his claim was timely. However, the ALJ distinguished Ingersolh-Rand, pointing out that, there, the Commissioner’s office had no record of receiving a Form SF-3A from the employer. Whereas, here, there was evidence that the carrier had filed an SF-3A after each termination of TTD benefits. Determining that the employer had complied with its obligation under KRS 342.040, the ALJ concluded that the claim must be dismissed because it was not filed within the applicable period of limitations.

A majority of the Board rejected the employer’s assertion that the claimant’s remedy was before the Board of Claims or in a malpractice action. It determined that the Commissioner’s failure to notify the claimant of the applicable period of limitations tolled the period for filing the claim. Its rationale was that KRS 342.040(1) imposes a mandatory obligation on the Commissioner. Noting that a high percentage of injured workers have a limited education and noting the claimant’s testimony that he did not know the English language when he immigrated to the United States in 1994, the majority opinion pointed out that the purpose of the provision is to protect injured workers and to ensure that they are informed of their legal rights. In view of the lack of any evidence that the Commissioner sent the required letter and the claimant’s testimony that he did not receive such a letter, the majority concluded that public policy required that the period of limitations be tolled. A dissenting opinion expressed the view that other remedies were available to the claimant and that an employer who complied with its statutory obligation should not be penalized for the Commissioner’s failure.

Appealing, the claimant indicates that sometime after the Court of Appeals’ majority rendered its decision reversing the Board, the parties discovered that the decisions below were based upon an erroneous understanding of the facts. The employer and the Special Fund agree. The parties indicate that since January 1, 1996, workers’ compensation carriers have been required to inform the Commissioner that the employer has terminated TTD benefits in electronic format on a Form IA-2 rather than by filing a paper copy of a Form SF-3A as had previously been done. 803 KAR 25:170, § 2(1). The employer indicates that its insurance carrier, like many others, relies upon an outside agent to do this. Although the handwritten Form SF-3A that was made part of the record indicated that it had been filed electronically, the employer concedes that it has since learned that the agent did not in fact file the required form with the Department. Thus, the employer also concedes that it did not comply with its obligation to notify the Commissioner that TTD benefits were terminated. It waives any time limitation on the claimant’s right to reopen the claim and joins the Special Fund and the claimant in requesting that the matter be remanded to an ALJ for further proceedings that are based upon the actual facts.

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Lizdo v. Gentec Equipment, 74 S.W.3d 703, 2002 Ky. LEXIS 92, 2002 WL 1000899 (Ky. 2002).

74 S.W.3d 703 (Lizdo v. Gentec Equipment) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

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