Opinion
W.C. No. 4-601-867.
December 3, 2009.
FINAL ORDER
The claimant seeks review of an order of Administrative Law Judge (ALJ) Friend dated July 15, 2009, that allowed the respondents to offset workers' compensation benefits as a result of Social Security benefits awarded to the claimant. We affirm.
The claimant sustained an admitted industrial injury on September 30, 2003. The claimant was later determined to be eligible for Social Security Disability Insurance (SSDI) benefits on January 21, 2008. The claimant was awarded past due benefits in the amount of $32,160.00. The ALJ found that past due Social Security benefits awarded resulted in an overpayment of worker's compensation benefits in the amount of $19,052.45. The claimant incurred attorney fees of $5,221 and an expense of $509.50 for an expert vocational evaluation performed in connection with the Social Security claim. The claimant argued that because the respondents had failed to provide any assistance in obtaining the Social Security benefits they should not be entitled to offset those benefits. The ALJ determined that both the attorney fees and the costs incurred by the claimant in the Social Security claim needed to be taken into consideration. The ALJ found that one-half of the $5,730.50 must be deducted from the overpayment. Therefore, the ALJ concluded that the final overpayment was $16,187.20. We note that other modifications to the resulting overpayment were made, but are not relevant here. This appeal by the claimant followed.
I.
The claimant first contends that the ALJ erred because she should not be required to bear the cost of fifty percent of all attorney fees and costs to obtain an award of Social Security benefits. The claimant argues the respondents failed to provide any assistance and did not participate in any way in the claimant's recovery of Social Security benefits. The claimant contends that she bore all of the risk and expense of an unfavorable result in her litigation to obtain Social Security benefits. In contrast, the claimant contends the respondents received a distinct monetary benefit from her litigation efforts while being relieved of the expense, effort and financial risk of pursuing the offset. The claimant argues that the respondents should be required to pay more than fifty percent cost of the attorney fees and costs related to the claimant's receipt of Social Security benefits. Therefore, the claimant seeks an order of remand to the ALJ requiring the entry of an order which equitably considers the relative contribution of the injured worker, the employer and the insurance carrier in obtaining the fund from which the offset of benefits is derived. We are not persuaded that a remand is necessary.
The Social Security offset provided under § 8-42-103(1)(c)(I) C.R.S. 2009 is for one half of the benefit. In St. Vincent's Hospital v. Alires, 778 P.2d 277 (Colo. App. 1989), the court approved of subjecting a lump sum payment of SSDI benefits to this statutory offset, without offsetting the portion of the award corresponding to fees paid to the claimant's attorney for securing the benefits. In Jones v. Industrial Claim Appeals Office, 892 P.2d 425, 426 (Colo. App. 1994), the court upheld the deduction of attorney fees from an SSDI award prior to applying the statutory offset and commented that "[b]ecause the attorney fees are deducted before calculation of the offset, the claimant and the insurer each bear one half of the fees." Citing Alires and Jones, the ALJ included the attorney fees and costs in his calculations, but those calculations had the net effect of excluding those fees and costs from the statutory offset.
The claimant asserts that she should not have to pay half of his attorney fees and costs in order to obtain SSDI benefits. This is similar to the argument made by the claimant in Jones, who asserted that the insurer should be required to deduct half the amount of the claimant's attorney fees from the amount of the offset. The court declined to hold the insurer directly responsible for half of the claimant's attorney fees after they were removed from the effect of the statutory offset. We find no meaningful distinction between the claimant's arguments in this matter and that of the claimant in Jones. Further, the ALJ's decision supports the purpose of section 8-51-101(1)(d), which is to prevent double recovery by the claimant. Colorado Dept. of Highways v. Sparling, 821 P.2d 780 (Colo. 1991), citing Myers v. Colorado, 162 Colo. 435, 440-41, 428 P.2d 83, 86 (1967). We decline to interfere with the ALJ's order.
II.
The claimant next contends that the ALJ, on remand, should be instructed to calculate an offset based on an amount proportional to the employer's percentage of total contribution to the "disability plan." As we understand the claimant's argument, it is premised on the fact that she was hired by the employer on August 5, 2003 and was shortly after injured on September 30, 2003. Therefore, the claimant argues that while she made mandatory contributions to the Social Security Administration for the twenty quarters necessary to qualify for benefits the employer only contributed for less than one full quarter to the claimant's eligibility. The claimant contends the current statutory scheme is unconscionable because it allows the respondents to reap the benefits of receipt of fifty percent of the claimant's entitlement to Social Security benefits regardless of the employer's contribution to the entitlement of such benefits. The claimant requests that the matter be remanded and the ALJ be instructed to calculate an offset based upon an amount proportional to the employer's percentage of total contribution to the disability plan. We again are not persuaded that a remand is necessary.
The claimant notes that § 8-42-103(1)(c)(I). C.R.S. 2009 provides that injured workers who are determined to be eligible for periodic disability benefits granted by the federal old-age, survivors, and disability insurance act are potentially subject to a reduction in indemnity benefits at an amount not below zero by an amount equal as nearly as practical to one-half such periodic benefits. The claimant contrasts this with § 8-42-103(1)(d)(I), which provides that for employees who are found to have contributed to the disability plan, benefits are reduced only in an amount proportional to the employer's percentage of total contributions to the disability plan. From this the claimant draws the conclusion that treating injured workers who contribute to the social security program differently than those who have contributed to an employer-sponsored disability plan creates an inequity not justified by the terms of the Workers' Compensation Act. Therefore, the claimant argues the ALJ erred by adopting a "scheme" whereby the respondents received a windfall by allowing them to offset one-half of the social security benefits received by the claimant. We disagree.
Section 8-42-103(1)(c)(I) provides as follows:
In cases where it is determined that periodic disability benefits granted by the federal old-age, survivors, and disability insurance act are payable to an individual and said individual's dependents, the aggregate benefits payable for temporary total disability, temporary partial disability, permanent partial disability, and permanent total disability pursuant to this section shall be reduced, but not below zero, by an amount equal as nearly as practical to one-half such federal periodic benefits; but, if provisions of the federal old-age, survivors, and disability insurance act should be amended to provide for a reduction of an individual's disability benefits thereunder because of compensation benefits payable under articles 40 to 47 of this title, the reduction of compensation benefits provided in said articles shall be decreased by an amount equal to such federal reduction. Upon request of the insurer or employer, the employee shall apply for such federal periodic benefits and respond to requests from the insurer or employer as to the status of such application. Failure to comply with this section shall be cause for suspension of benefits.
In contrast § 8-42-103(1)(d)(I) provides that
In cases where it is determined that periodic disability benefits are payable to an employee under the provisions of a pension or disability plan financed in whole or in part by the employer, hereinafter called "employer pension or disability plan", the aggregate benefits payable for temporary total disability, temporary partial disability, permanent partial disability, and permanent total disability pursuant to this section shall be reduced, but not below zero, by an amount equal as nearly as practical to such employer pension or disability plan benefits, with the following limitations:
(A) Where the employee has contributed to the employer pension or disability plan, benefits shall be reduced under this section only in an amount proportional to the employer's percentage of total contributions to the employer pension or disability plan.
Here the ALJ noted that the offset was for social security benefits received by the claimant and therefore he applied § 8-42-103(1)(c)(I), which relates to those benefits rather than the offset provision of the act relating to employer disability plans under § 8-42-103(1)(d)(I). In our view, the distinction made between the method for determining the amount of offsets for social security benefits and benefits received under an employer disability plan was made by the General Assembly, not by the ALJ. Therefore, we perceive no error on the part of the ALJ in adhering to the plain and ordinary meaning of the language of the statute.
As noted by the court in Sampson v. Weld County School District, 786 P.2d 488 (Colo. App. 1989), in discussing the predecessor to the present § 8-42-103(1)(d)(I), this section of the Act is expressly limited to an offset for disability benefits payable under a pension or disability plan "financed in whole or in part by the employer." In contrast, the Sampson court observed in discussing the predecessor to the present 8-42-103(1)(c)(I), that this section of the Act "does not contain an explicit requirement indicating that the offset is dependent on the employer having paid Social Security taxes," and the court declined to read such a requirement into the statute. Sampson, 786 P.2d at 489. Consequently, the Sampson court concluded that an employer is entitled to the statutory offset even if the employer has not contributed to the source of the SSDI benefits by the payment of social security taxes on the claimant's wages. We conclude that Sampson v. Weld County School District is dispositive of the issue presented here. See also, Weathers v. Mary Jane Broom D/B/A A B B Inc., W. C. No. 3-048-712(April 30, 1996). Consequently, the ALJ did not error in allowing the offset.
The claimant's reliance upon Pena v. Family Dollar Stores, Inc. W.C. No. 4-412-966 (May 4, 2006) is misplaced. In Pena the panel noted that under the "common fund doctrine" recognized in County Workers' Compensation Pool v. Davis, 817 P.2d 521 (Colo. 1991), when an injured party's tort claim is settled for an amount greater than its insurer's subrogation claim, and the insurer has not actively participated in the tort litigation, a court may order the insurer to pay a reasonable share of the attorney fees and court costs incurred in the course of the litigation. However, the panel noted that in County Workers' Compensation Pool v. Davis the court relied heavily on the fact that the insurer would be unjustly enriched because it elected not to pursue its right to intervene and participate in the litigation against the third-party tortfeasor. Here the employer, like the Subsequent Injury Fund in Pena, had no right to intervene in the claim for Social Security benefits.
To the extent the claimant's argument may be understood as asserting a constitutional challenge to § 8-42-103, we lack jurisdiction to address such a challenge. Kinterknecht v. Industrial Commission, 175 Colo. 60, 485 P.2d 721 (1971); Celebrity Custom Builders v. Industrial Claim Appeals Office, 916 P.2d 539 (Colo. App. 1995). However, we note that such an argument appears to have been rejected in Sampson v. Weld County School District.
Insofar as the claimant may be viewed as asserting denial of procedural due process, we are not persuaded that such a denial occurred. The fundamental requirements of due process are notice and an opportunity to be heard. Due process contemplates that the parties will be apprised of the evidence to be considered, and afforded a reasonable opportunity to present evidence and argument in support of their positions. Inherent in these requirements is the rule that parties will receive adequate notice of both the factual and legal bases of the claims and defenses to be adjudicated. See Hendricks v. Industrial Claim Appeals Office, 809 P.2d 1076, 1077 (Colo. App. 1990).
Here the matter proceeded to hearing before the ALJ on the issue of the social security offset. The claimant was afforded an opportunity to present witness and evidence. The claimant did present evidence and filed a position paper on the issue in question. Accordingly, we are not persuaded she was denied due process of law and therefore the claimant has failed to establish grounds which afford us a basis to grant appellate relief.
IT IS THEREFORE ORDERED that the ALJ's order dated July 15, 2009 is affirmed.
INDUSTRIAL CLAIM APPEALS PANEL
______________________________ John Baird
______________________________ Thomas Schrant
SUSAN SCHRAMEK, 3750 N CASCADE AVE #F-86, COLORADO SPRINGS, CO, (Claimant).
HARTFORD INSURANCE COMPANY, Attn: LUCY ARGUELLO, C/O: SPECIALTY RISK SERVICES, DENVER, CO, (Insurer).
STEVEN U MULLENS, PC, Attn: STEVEN U MULLENS, ESQ., COLORADO SPRINGS, CO, (For Claimant).
BLACKMAN LEVINE, LLC, Attn: TAMA L LEVINE, ESQ., DENVER, CO, (For Respondents).