Opinion
BOARD No. 01418987
Filed: November 21, 1995
REVIEWING BOARD DECISION
(Judges Maze-Rothstein, Kirby and Smith)
APPEARANCES
John K. McGuire Jr., Esq., for the employee.
Ron Johnson, Esq., for the insurer.
The employee appeals a decision denying her claim for § 35 partial incapacity benefits beyond her sixty-fifth birthday pursuant to the "old" version of § 35E as enacted by St. 1985, c. 572, § 45. She asserts two arguments on appeal: 1) whether an administrative judge can unilaterally raise § 35E sua sponte when the parties had not done so and 2) whether the administrative judge can apply § 35E to a case involving injuries sustained prior to November 1, 1986.
General Laws c. 152, § 35E (St. 1985, c. 572, § 45) was enacted effective November 1, 1986 and reads:
Any person receiving old age benefits pursuant to federal social security law or receiving pension benefits paid in part or entirely by an employer shall not be entitled to benefits under section thirty-five, unless such employee can establish that but for the injury, such employee would have remained active in the labor market.
General Laws c. 152, § 35E has since been amended by St. 1991, c. 398, § 66, which amendment has no bearing on the case at bar.
We find that it was error for the judge to apply § 35E sua sponte after the hearing and without giving the parties an opportunity to be heard. Further, there is no evidence in the record that the employee received any retirement benefits or even applied for them. Findings without evidentiary support cannot stand. Kilcullen v. San Vel Concrete Corp., 4 Mass. Workers' Comp. Rep. 182, 183-184 (1990). As we have recently stated regarding retroactive application of the 1985 version of § 35E to a pre-enactment date of injury, the statute is procedural and thus retroactive pursuant to § 2A. Bamihas v. Table Talk Pies, 9 Mass. Workers' Comp. Rep. ___ (October 25, 1995). Nonetheless, because § 35E was raised sua sponte after the hearing and without affording the parties the opportunity to be heard and was applied without any support on the record, we reverse the discontinuance that flowed from that finding.
Section 2A provides:
Every act, in amendment of this chapter, in effect on the effective date of this section or thereafter becoming effective which increases the amount or amounts of compensation payable to an injured employee or his dependents shall, for the purposes of this chapter, be deemed to be substantive in character and shall apply only to personal injuries occurring on and after the effective date of such act, unless otherwise expressly provided. Every act, in amendment of this chapter, in effect on the effective date of this section or thereafter becoming effective which is not deemed to be substantive in character within the meaning of this section shall be deemed to be procedural or remedial only, in character, and shall have application to personal injuries irrespective of the date of their occurrence, unless otherwise expressly provided.
Added by St. 1946, c. 386, § 3. Section 2A was recently amended by St. 1991, c. 398, § 16, which does not apply here.
The pertinent facts as found by the administrative judge follow. The employee, seventy-two years of age, worked as a dietary aide for more than twenty years. (Dec. 3.) She suffered five industrial injuries between May 23, 1973 and September 11, 1982 to her knees, left hip, the calf area of one of her legs, right shin, shoulder, elbow and ear. (Dec. 4-5.) The employee stopped working on September 14, 1983, after pain caused by these injuries became severe. (Dec. 9.)
Based on the testimony and evidence presented, the administrative judge found the employee to be partially disabled as a result of the multiple traumas sustained on May 23, 1973, November 18, 1980, April 4, 1981, June 23, 1981, February 22, 1982 and September 11, 1982. He ordered § 35 benefits of $144.02 per week commencing on September 15, 1983. However, the administrative judge went on to find that the employee, "but for" her injuries, would not have stayed active in the labor market, and as such, he found that she was not entitled to receive workers' compensation benefits beyond her July 12, 1987 sixty-fifth birthday or the date of her first superannuation retirement payment, whichever came first. This finding is erroneous.
Additionally, it was error as matter of law, to apply § 35E sua sponte without notice to the parties and without the insurer ever having raised the issue in defense of the claim. See Haley's Case, 356 Mass. 678, 681 (1970) (parties are entitled to opportunity to present evidence and "to know what evidence is presented against them and to an opportunity to rebut such evidence, and to argue . . . on the issues of fact and law involved in the hearing").
Section 1.11(3) of 452 Code Mass. Regs. states:
Before the taking of testimony in a hearing before an administrative judge, the insurer shall state clearly the grounds on which the insurer either has declined to pay compensation, or the ground on which it seeks modification or discontinuance. . . . On all other issues the employee's rights under M.G.L.c. 152 shall be deemed to have been established. (Emphasis added).
Regulations are indistinguishable from statutes as regards their force and effect as law. The import of regulation 1.11(3) is unmistakable: an insurer must give the employee fair notice of the grounds for its defense at hearing. See Haley's Case, 356 Mass. at 681. Further, an insurer cannot expect judicial assistance in assertion of defenses that could extinguish entitlement to benefits. Bamihas, supra at and cases cited.
The 1985 version of § 35E created a rebuttable presumption that an employee's entitlement to § 35 benefits would terminate upon receipt of certain varieties of old age benefits unless he showed that but for the injuries he would have remained active in the labor market.
There is no evidence on the record to support the judge's conclusion that the employee would not have remained active in the labor market. Nor was there any evidence that the employee was receiving old age retirement benefits or old age social security. G.L.c. 152, § 35E. The employee did apply for accidental disability retirement in 1987. That application was denied. In its denial, the Board of Retirement made it clear that the employee did qualify for superannuation retirement, but as of the November 2, 1987 hearing date she had not applied. (Employee Ex. 1.) The judge based his § 35E determination on the slender reed of this exhibit that is at best equivocal about the type of retirement for which the employee could qualify — even if she had applied. Moreover, accidental disability retirement is not to be confused with old age retirement. In no event could this evidence support a finding that she was receiving any variety of old age retirement benefits.
Accordingly, we reverse the judge's decision to discontinue benefits because it is without any support in the record and because § 35E was reached and applied in a way that was contrary to law. G.L.c. 152, § 11C. We reinstate the order to pay § 35 partial benefits of $144.02 based on the average weekly wage of $216.03 and a $60.00 assigned earning capacity. The insurer may seek to modify or discontinue benefits at any point subsequent to the February 27, 1991 filing date of the administrative judge's decision. The insurer is to pay employee counsel fees of $1,500.00.
The concurrence takes exception to the order, drawing comparisons with other cases that are factually and equitably distinct. In the case at bar the order derives from a clear defensive opportunity missed in an adversarial process where the judge also mishandled the situation. In such circumstances, consistent with our ruling in Welch v. A.F.B. Systems, 9 Mass. Workers' Comp. Rep. ___ (April 26, 1995), the decision may not reach prior to the time frame and issues posed by the insurer. Despite the insurer's decrement, in a proactive mode the judge could have himself identified the issue at hearing. He did not. Therefore since § 35E was not in contest up to the decision filing date, a new complaint with the issue properly raised, may be filed at any point subsequent to the filing date of the defective decision. See Aquiar v. Gordon Aluminum Vinyl, 9 Mass. Workers' Comp. Rep. ___ (March 27, 1995) (for discussion of limited equitable flexibility in applying res judicata principles under c. 152).
So ordered.
_________________________ Susan Maze-Rothstein Administrative Law Judge
_________________________ Edward P. Kirby Administrative Law Judge
Filed: November 21, 1995
Because there is no evidence in the record which will support the conclusion that the employee was actually receiving old age retirement benefits, I agree that the decision is arbitrary, capricious and contrary to law and therefore must be vacated. However, I disagree that the equitable result is reversal and award, rather than remand. The difference is an award of eight years of benefits to which the employee, now age seventy-three, may not be entitled and may have to repay.
If the judge inferred receipt because of mandatory retirement at age sixty-five, this was an impermissible inference as such mandatory retirement provisions are prohibited by federal law. 29 U.S.C. § 621-634.
Permitting the insurer to file a retroactive discontinuance is inconsistent with board precedent, Welch v. A.B.F. Systems, 9 Mass. Workers' Comp. Rep. ___ (April 26, 1995), and is not the simple and summary procedure required by G.L.c. 152, § 11B. The award and permission to retroactively discontinue will require the insurer to again navigate the bureaucratic stages of conciliation, § 10, and conference, § 10A, and may result in an overpayment not easily recouped. See § 11D(3).
Certainly when it comes to providing a remedy on appeal to a party wronged by a decision, both the insurer and the employee should be treated equally. This reviewing board panel has already held that an employee's rights are not sufficiently protected by a ruling permitting subsequent refiling. Mendez v. The Foxboro Co., 9 Mass. Workers' Comp. Rep. ___, slip op. at 12 (October ___, 1995). Should an insurer receive less just treatment? A remand to determine the level of incapacity up to the date the record closed, to wit: July 27, 1990, permitting the insurer to produce evidence after that date of receipt of old age benefits pursuant to federal social security law or pension benefits paid in part or entirely by an employer, is the appropriate remedy to correct the administrative judge's error and is consistent with the principles of res judicata discussed in Aguiar v. Gordon Aluminum Vinyl, 9 Mass. Workers' Comp. Rep. ___, slip op. at 4 (March 27, 1995).
Furthermore, I disagree with the majority's "sua sponte" analysis. My position is fully discussed in my opinion in Bamihas v. Table Talk Pies, Inc., 9 Mass. Workers' Comp. Rep. ___, slip op. (October ___, 1995) and need not be repeated here.
For these reasons I concur in the vacation of the decision on § 35E but dissent on the resulting order of reinstatement of ongoing benefits.
________________________ Suzanne E.K. Smith Administrative Law Judge