Summary
In Corrugated Container Co. v. Dickerson (1960), 171 Ohio St. 289, 291, 13 O.O.2d 337, 338, 170 N.E.2d 255, 257, we specifically held that "[n]o part of the State Insurance Fund, a trust fund for the benefit of employers and employees, may be used for administrative purposes except as provided in Section 4123.
Summary of this case from Northwestern Ohio Bldg. Const. Trades v. ConradOpinion
No. 36763
Decided November 2, 1960.
Workmen's compensation — State Insurance Fund — Purpose for which established — Trust fund for payment of workmen's compensation benefits — Not available for payment of administrative costs — Funds not transferrable therefrom to general fund.
APPEAL from the Court of Appeals for Franklin County.
The plaintiff, an employer and a contributor to the State Insurance Fund, brought this action for a declaratory judgment to have determined whether the General Assembly has the power to direct the payment of money from the State Insurance Fund into the General Revenue Fund.
The question arose because the General Assembly included in the General Appropriation Act of 1959 (Amended Substitute House Bill No. 831, effective June 30, 1959) the following paragraph:
"The State Insurance Fund shall pay into the general fund, one-fourth of the amount of the appropriations for the Industrial Commission and the Bureau of Workmen's Compensation for each fiscal year on or before August 15, November 15, February 15, and May 15 of each fiscal year. The amount of any unencumbered balances remaining in such appropriations as of June 30, 1961, shall be reimbursed to the State Insurance Fund from the general fund."
Similar provisions, with respect to the Attorney General and the Treasurer of State, are included in the same act. By a two to one vote, the Industrial Commission adopted a resolution giving effect to such provisions.
The requirement that the state Insurance Fund reimburse the general fund for all amounts appropriated for administrative costs of the Industrial Commission, instead of only two-thirds as required by Sections 4123.341 and 4123.342, Revised Code, which amount the commission is authorized to collect from employers for that purpose, prompted this action. The remaining one third, which is to be paid by the state under Section 4123.341, Revised Code, and for which no tax has been levied and no assessments made or collected, would have to come from money collected to pay awards of compensation.
The Court of Common Pleas held that the General Assembly does not have authority to direct payments from the State Insurance Fund to the general fund, and that those provisions of the appropriation act which direct such payments are invalid, being in violation of the Constitution.
The Court of Appeals, on appeal on questions of law, affirmed the judgment of the trial court.
An appeal as of right brings the cause to this court for review.
Messrs. McConnaughey, McConnaughey Stradley and Messrs. Vorys, Sater, Seymour Pease, for appellee.
Mr. Mark McElroy, attorney general, Mr. John F. O'Brien and Mr. John A. Hoskins, for appellants.
The question here presented is whether the state can take money which has been set aside for the payment of awards to injured workmen and the dependents of killed workmen and transfer it to the money comprising the General Revenue Fund of the state.
Section 35 of Article II of the Constitution provides that, for the purpose of providing compensation to workmen and their dependents for death, injury or occupational disease occasioned in the course of such workmen's employment, laws may be passed establishing a state fund to be created by compulsory contribution thereto by employers and to be administered by the state.
Section 4123.29, Revised Code, provides that the Industrial Commission shall classify and fix rates of premiums to maintain a State Insurance Fund. Section 4123.30, Revised Code, provides that money contributed by certain employers shall constitute a "public fund," that money contributed by certain other employers shall constitute a "private fund," that such funds shall be referred to as the "State Insurance Fund," and that such fund shall "constitute a trust fund for the benefit of employers and employees" for the payment of compensation for losses sustained on account of injury, disease or death, as provided in Sections 4123.01 to 4123.94, Revised Code, " and for no other purpose." There is no provision for payment of administrative costs.
The provisions of the appropriation act above referred to are ambiguous. They do not direct whether the payments shall be made from the "public fund" or the "private fund," or, if it is to be assumed that payments are to be made from both funds, the question then arises, in what proportion. No provision is made for the exercise of discretion by the Industrial Commission or other state agency.
Section 4123.341, Revised Code, defines administrative costs and provides that one-third thereof shall be paid from general revenues in order to discharge the state's obligation to render justice to employees and employers. Section 4123.342, Revised Code, provides that counties, taxing districts and private employers shall pay two-thirds of such costs.
The policy of the state relative to the State Insurance Fund and administrative costs has been declared by the constitutional and statutory provisions above referred to, and the General Assembly has not, because of the ambiguous provisions of the appropriation act above referred to, either expressly or by clear implication declared an intention to modify or change such policy. Such provisions of the appropriation act are in conflict with the established policy of the State and are violative of the express limitation placed upon the State Insurance Fund by Section 35, Article II of the Constitution.
No part of the State Insurance Fund, a trust fund for the benefit of employers and employees, may be used for administrative purposes except as provided in Section 4123.342, Revised Code, and the Industrial Commission was without authority to adopt its resolution attempting to transfer money from the State Insurance Fund to the general fund in accordance with the appropriation act.
The judgment of the Court of Appeals is affirmed.
Judgment affirmed.
WEYGANDT, C.J., ZIMMERMAN, TAFT, MATTHIAS, BELL, HERBERT and PECK, JJ., concur.