Office of Administrative Law Judges
United States Department of Labor
MONTHLY DIGEST # 125
May 1996 - August 1996
I. Longshore
A. Circuit courts
In Total Marine Services v. Director, OWCP, ___ F.3d
___, Case No. 95-60421 (5th Cir. July 16, 1996), the court held
that the "borrowing" Employer was liable for benefits
under the Act, even though Claimant's formal Employer (the
temporary labor service) had secured payment of compensation.
Absent a valid and enforceable indemnification agreement, a
borrowing employer is required to reimburse an injured worker's
formal employer for any compensation benefits it has paid to the
employee under the Act.
[ contractor/subcontractor liability ]
B. Benefits Review Board
In Smith v. Alter Barge Line Inc., 30 B.R.B.S. 87
(1996), the Board held that if an employee, who changes jobs,
undergoes a "permanent change in status at the time of his
injury," then coverage is determined pursuant to the new
job. However, in Smith, the Board noted that the judge
properly "found that decedent's classification as a mate
trainee at the time of his death occurred posthumously, and did
not reflect decedent's actual work status when he died" as
he was predominantly performing the duties of a welder upon
death. The Board further noted that "the fact that claimant
collected life insurance benefits as a mate/trainee/deckhand
rather than as a welder does not negate the administrative law
judge's finding that decedent's work (at the time of injury) was
predominantly welding, and that decedent is entitled to Longshore
Act coverage."
[ subject matter jurisdiction ]
In Green v. C.J. Langenfelder & Son, Inc., 30
B.R.B.S. 77 (1996), the Board reiterated the United States
Supreme Court's holdings that "in determining seaman status
(under § 2(3)(G) of the Act), the key is whether the
employee had an employment-related connection to the
vessel." If so, it must then be determined whether the
vessel was a "vessel in navigation" which, as the Board
held, "requires analysis of factors relating to the
characteristics of the craft involved including whether it was
(1) constructed or used primarily as a work platform, (2) moored
or otherwise secured at the time of the accident, and (3) capable
of movement across navigable waters in the course of normal
operations and, if so, whether such transportation was merely
incidental to its primary purpose of serving as a work
platform."
[ coverage under the Act ]
In Jenkins v. Norfolk & Western Railway Co., ___
B.R.B.S. ___, BRB No. 92-0102 (July 3, 1996), the Board held that
"[a]ttorney's fees are excluded in calculating the amount of
the offset pursuant to Sections 3(e) and 33(f) because, as
claimant was never in receipt of the funds designated as
attorney's fees, there is no danger of a double recovery for the
disability in question."
[ offset/credit under §§ 3(e) and 33(f);
attorney's fees ]
In Schoen v. U.S. Chamber of Commerce, ___ B.R.B.S.
___, BRB Nos. 91-2071 and 91-2071A (July 31, 1996), the Board
reiterated that "[u]nder Section 7(d) of the Act . . . an
employee is entitled to recover medical benefits if she requests
employer's authorization for treatment, the employer refuses the
request, and the treatment thereafter procured on the employee's
own initiative is reasonable and necessary." The Board held
that an "employer's mere knowledge of claimant's pain does
not create an obligation to pay for medical care in the absence
of a request for treatment." However, in Schoen, it
was determined that Claimant requested authorization for
treatment by phone and by letter but Employer delayed in
responding to the request for more than one month. Thus, the
Board agreed with the administrative law judge and held that
because "the record reflected that employer was aware that
claimant was in severe pain, this delay was unreasonable, and
accordingly constituted a constructive denial of claimant's
authorization request."
Moreover, in determining the amount of reimbursement owed by
Employer for Claimant's self-procured medical treatment, the
Board held that "while the proximity of the medical care to
claimant's residence is a factor to be considered in determining
the reasonableness of medical treatment, where competent care is
available locally, claimant's medical expenses may reasonably be
limited to those costs which would have been incurred had the
treatment been provided locally."
Finally, the Board held that Claimant is not entitled to a
§ 20(a) presumption that "her self-procured medical
expenses were reasonable"; rather, Claimant must prove each
element of her claim for medical benefits.
[ reimbursement for medical expenses; employer's one
month delay in authorizing medical treatment constituted
"constructive" refusal to authorize treatment; §
20(a) presumption inapplicableto medical benefits
claim ]
In Hamilton v. Ingalls Shipbuilding, Inc., 30
B.R.B.S. 84 (1996), the Board held that the ten day period for
filing a motion for reconsideration of an administrative law
judge's compensation order under 20 C.F.R. § 802.207(b)(1),
"commences on the date that the district director certifies
that he filed the Decision and Order."
[ timeliness of motion for reconsideration
]
In Taylor v. Plant Shipyards Corp., 30 B.R.B.S. 90
(1996), the Board held that it was error for the administrative
law judge to decline to consider the § 33(g) issue raised by
Employer post-hearing. In so holding, the Board noted that there
was a "significant" change in law after the hearing and
"employer's letter seeking application of the (new law) to
the instant case is dated two days after (new) case's issuance,
and was received by the administrative law judge prior to the
filing of his compensation order."
Moreover, in this case involving asbestos related injuries,
the Board reiterated that "the employer responsible for
claimant's disability benefits is the last employer to expose the
claimant to injurious stimuli prior to the date on which the
claimant became aware of the fact that he was suffering from an
occupational disease." The Board held that it was proper
for the administrative law judge to use social security records
to determine the last responsible employer as opposed to
Claimant's testimony where the judge noted that Claimant had
difficulty recalling "other noteworthy events from this
period (of time)."
[ new issue presented for adjudication; occupational
diseases and the Cardillo rule ]
In Quan v. Marine Power & Equip. Co., ___ B.R.B.S.
___, BRB No. 92-0861 (Aug. 15, 1996), the Board held that,
"for purposes of Section 8(f) relief where the employee is
permanently partially disabled, employer must show by medical
evidence or otherwise that claimant's disability as a result of
the pre-existing condition is materially and substantially
greater than that which would have resulted from the work injury
alone, and that the last injury alone did not cause claimant's
permanent partial disability." The Board held that the case
must be remanded, therefore, because "the administrative law
judge did not specifically address the evidence of available jobs
or consider whether claimant's shoulder injury alone would cause
the same degree of loss of wage-earning capacity as that
manifested in the ultimate permanent partial disability through
the contribution of the pre-existing permanent partial disability
(of palsy and depressive reaction)."
Moreover, the Board held that, because the shoulder injury
was not covered by the Act's schedule, the compensation rate
would be determined "based on the difference between
claimant's pre-injury average weekly wage and his post-injury
wage-earning capacity." Further, the wage-earning capacity
must account for inflation and "the change in the National
Average Weekly Wage (over time) is the most reasonable
approximation of the inflationary rate."
[ Section 8(f) relief; wage-earning capacity and
inflation based upon the NAWW ]
In Armfeld v. Shell Offshore, Inc., ___ B.R.B.S. ___,
BRB No. 92-2561 (Aug. 15, 1996), the Board held that the
secretarial positions offered by Employer in its wage survey did
not constitute suitable alternate employment as the
uncontradicted testimony of Claimant and her psychiatrist was
that Claimant suffered from "atypical depression and post-traumatic stress disorder"
and her "psychological
problems cause(d) her to have difficulty in handling
interpersonal conflict" such that she would not be capable
of working as a secretary.
[ suitable alternate employment ]
In Uddin v. Saipan Stevedore Co., ___ B.R.B.S. ___,
BRB No. 93-1947 (Aug. 13, 1996), the Board reiterated that the
Act applies to longshore and harbor worker injuries which occur
within the U.S. affiliated territory of Guam and then upheld the
administrative law judge's finding that the Act also applies to
such injuries occurring within the U.S. affiliated territory of
the Commonwealth of the Northern Mariana Islands.
[ coverage under the Act; U.S. affiliated
territory ]
Following Ninth Circuit precedent, the Board reiterated in
Foree v. Kaiser Aluminum and Chemical Corp., ___ B.R.B.S.
___, BRB Nos. 93-0296 and 93-0296A (Aug. 19, 1996), that "an
injured employee's spouse and daughter were persons 'entitled to
compensation' under both Sections 33(g)(1) and 33(f) of the
Act . . . at the time they settled their potential wrongful
death actions prior to the death of the employee." Thus,
Section 33(f) could "be applied to provide employer with any
offset (of the settlement proceeds) against (claimant's) death
benefits."
With regard to apportionment and offset, the Board held the
following:
Section 33(f) mandates that employer's liability
for decedent's disability benefits should be
offset by the net amount decedent received
in settlement, and employer's liability for
claimant's death benefits should be offset by the
net amount claimant received in the
settlement of her wrongful death action.
(emphasis in original). The Board further stated that
"employer bears the burden of establishing apportionment
pursuant to (Ninth Circuit precendent), (and) the Act does not
prohibit an employer from relying on evidence submitted by
claimant in pursuit of establishing apportionment."
Finally, the Board concluded that the §33(f) offset
provisions are directed at the "net amount of recovery"
in the wrongful death action as opposed to recovery based upon
separate injuries. Specifically, Claimant could not assert that
"employer's liability for death benefits should not be
offset by claimant's recovery for her separate injury of loss of
consortium, as that injury does not arise from decedent's
death." Rather, Employer was entitled to an offset of
"the entire amount, regardless of the type of damages
involved."
[ § 33(f) offset; apportionment ]
In Downs v. Ingalls Shipbuilding Inc., ___ B.R.B.S.
___, BRB No. 95-1682 (June 18, 1996), the Board held that the
administrative law judge properly ruled upon Claimant's motion to
withdraw his asbestos exposure claim where Employer sought to
have the claim barred under § 33(g) of the Act.
Specifically, the judge considered the motion in accordance with
the requirements of 20 C.F.R. § 702.225(a) and the Board
determined that "unless claimant files a new claim for
compensation or medical benefits, employer cannot be held liable
for benefits and therefore has suffered no present harm by virtue
of the claim's withdrawal."
[ withdrawal of occupational disease claim; §
33(g) ]
In Renfroe v. Ingalls Shipbuilding, Inc., ___
B.R.B.S. ___, BRB Nos. 91-170 and 91-170A (June 24, 1996)(en banc
on recon.), the Board initially noted that the Director had
standing to pursue the claim before it as "Congress chose
two distinct phrases in the statute, permitting appeal to the
Board by any party-in-interest' under Section 21(b)(3), while
limiting appeals to the federal courts under Section 21(c) to
persons adversely affected or aggrieved.'"
In these cases involving "retired employees who filed
hearing loss claims," the Board held that interest in
compensation owed is not due from the date of injury; rather, it
is due from the date that benefits are due under the Act. The
Board noted that "[t]he award of interest on benefits due
under the Act is not statutorily mandated but has been upheld as
consistent with the Congressional purpose of fully compensating
claimants for their injuries." Thus, interest awarded under
§ 14(e) and (f) of the Act is not intended to penalized
Employer; to the contrary, such an interest award is designed to
"make the claimant whole for his injury where employer has
withheld benefits and had the use of money due claimant."
Consequently, the Board held the following:
Pursuant to Section 14(b) of the Act, . . . the
first installment of compensation becomes due' on
the fourteenth day after employer is notified of
the injury under Section 12 . . . or has knowledge
of the injury, on which date, all compensation
then due shall be paid.
. . .
Inasmuch as an employer has no legal obligation to
pay compensation until 14 days after receiving
notice or knowledge, it logically follows that
interest should also be assessed from this date
because interest attaches to overdue compensation
benefits and no payments are overdue prior to this
date.
The Board also noted, as an aside, that the Black Lung
Benefits Act at 30 U.S.C. § 932(a) and the implementing
regulations at 20 C.F.R. § 725.608(a) provide that an
"employer is liable for interest on past due benefits
computed from the date on which such benefits were due and
payable.'" Because black lung benefits are due 30 days after
the initial determination of eligibility, "interest also
accrues from that point, as it is only then that the employer
profits from the unauthorized retention of a claimant's
funds.'"
Thus, the Board concluded that "interest in these
hearing loss claims properly accrues on unpaid benefits from the
date they become due under Section 14(b)" until such
benefits are paid.
[ interest due in hearing loss claims ]
In Hebert v. TTT Stevedores of Texas, BRB No. 92-1239
(June 27, 1996)(unpublished), a copy of which is attached, the
Board reversed the administrative law judge's holding that the
Special Fund was liable for the payment of Employer's attorney's
fees as a sanction under § 26 of the Act, but stated the
following:
Although the United States Supreme Court recently
indicated that even if a statute governs the
imposition of attorney's fees a court 'may resort
to its inherent power to impose attorney's fees as
a sanction for bad faith conduct,' Chambers v.
NASCO, Inc., 501 U.S. 32, 50 (1991), a court
should invoke this inherent power only when it
finds that 'fraud has been practiced upon it, or
that the very temple of justice has been
defiled.'
The Board also referred to its own precedent to state that only a
"court", i.e. federal district or circuit court,
may award sanctions under § 26 of the Act, and that neither
the administrative law judge nor the Board fall within the
definition of a "court."
