Selk v. Detroit Plastic Products

348 N.W.2d 652, 419 Mich. 32

Opinions

On Resubmission

Boyle, J.

On March 21, 1984, this Court issued its opinion in these consolidated workers’ compensation appeals. 419 Mich 1; 345 NW2d 184 (1984). Subsequently, defendants-appellants in each case filed timely motions for rehearing. We granted those motions on May 1, 1984, and the cases were resubmitted for decision. 419 Mich 1206.

We are persuaded that our original opinion in these cases requires clarification. Some of the language in the majority opinion, specifically the language found in the conclusion, lends itself to an interpretation never intended by this Court. Both the motions for rehearing and Justice Levin’s dissent suggest that under the Court’s interpretation, the date of the award is completely determinative of the interest rate applicable to payments made pursuant to such an award under all circumstances.¹

Such an interpretation is not consistent with our reasoning in the original opinion, and we granted the motions for rehearing in order to clarify any language which could be read to stand for such an application.

We reaffirm the rationale of the original opinion. We remain convinced that the Legislature intended 1981 PA 194 to award interest at 12% from the date each payment "was due”. Thus, "[w]hen weekly compensation is paid pursuant to an award * * * interest on the compensation shall be paid at the rate of 12% per annum from the date each payment was due”. 1981 PA 194 (emphasis added).

The date of the award is not determinative under this interpretation, and any suggestion to the contrary in our original opinion was inadvertent and should be disregarded. Rather, it is the date of payment which triggers the application of the 12% rate.

Where an employer pays compensation on or after January 1, 1982, pursuant to an award, interest on the award shall be paid at 12% from the date each payment was due.²_

To the extent that it is consistent with this clarification, the judgment of the Court of Appeals is affirmed. We are not persuaded that the other issues raised in the motions for rehearing merit further statement by this Court. We remand these cases to the WCAB for computation of interest in accordance with the rule expressed in this opinion.

Williams, C.J., and Ryan, Brickley, and Cav-anagh, JJ., concurred with Boyle, J.

Footnotes

1

Specifically, it has been suggested that under our interpretation, where an award was entered before January 1, 1982, interest accrues at 5% on all payments, even those which became due and payable on or after January 1, 1982.

2

Under this rule, neither the date of the award nor the due date of the payment is determinative of the applicable interest rate. Rather, the focus is on when the compensation is paid. If payment is made on or after January 1, 1982, interest is computed at 12% per annum from the date payment was due, regardless of the date of the award and regardless of when the payment was due.

The dissent in the original submission and on rehearing places great emphasis on the significance of the effective date specified in 1981 PA 194 as the key to a determination of whether the Legislature intended to increase an interest rate to apply retroactively or prospectively. The dissenters chide us for failure to accord proper respect to the significance of the effective date in our construction of the statute.

When one carefully examines how the Legislature utilizes effective dates, however, it is clear that we have accorded that respect which is properly due.

Effective dates are inserted by the Legislature in all kinds of statutes. When it wishes to address the question of retroactivity, the Legislature has specifically done so in addition to providing for an effective date.

For example, when the Legislature passed the new rule for a claim and delivery action, in 1976 PA 79, it provided in enactment § 2 that "[t]his amendatory act shall apply to all actions pending or commenced on or after the effective date of this act”. Enactment § 3 of the same statute provided: "This amendatory act shall take effect July 1, 1975”. Because the Legislature in connection with other statutes in enactment sections has specifically addressed retroactivity in addition to providing an effective date, we are unable to agree that the mere insertion of an effective date, standing alone, is dispositive of the prospective/retroactive effect of 1981 PA 194.

The primary purpose of an effective date may be to provide a date certain for the statute’s application. Given the fact that there is often a time lag between the date on which the Governor signs a bill and its applicability, effective dates provide notice to those who must conform their conduct to the law as specified in the enactment.

The minority suggests that we have ignored the significance of the effective date in 1981 PA 194. However, we have not ignored it, although we disagree with the minority concerning its significance. Properly construed, the effective date indicates that the amendatory statute applies on or after January 1, 1982. It says nothing about retroactivity. Therefore, it is not inconsistent to say that when interest on compensation is paid on or after January 1, 1982, the statute applies and the interest is computed at a rate of 12% per annum.