Workers’
Compensation Board
OPINION ENTERED: February 2, 2018
CLAIM NO. 201502100
SAPPHIRE COAL COMPANY PETITIONER
VS.
APPEAL
FROM HON. R. ROLAND CASE,
ADMINISTRATIVE LAW JUDGE
KEVIN WURSCHMIDT
AND HON. R. ROLAND CASE,
ADMINISTRATIVE LAW JUDGE RESPONDENTS
OPINION
AFFIRMING
*
* * * * *
BEFORE: ALVEY, Chairman, STIVERS and RECHTER, Members.
RECHTER,
Member. Sapphire
Coal Company (“Sapphire”) appeals from the July 28, 2017 Opinion, Award and
Order and the September 11, 2017 Order on Reconsideration rendered by Hon. R.
Roland Case, Administrative Law Judge (“ALJ”).
The ALJ determined Kevin Wurschmidt (“Wurschmidt”) contracted coal
workers’ pneumoconiosis while employed by Sapphire, and awarded income
benefits. Sapphire argues the ALJ erred
in ordering it to pay 12% interest on unpaid installments through June 28, 2017
and 6% thereafter. For the reasons set
forth herein, we affirm.
Wurschmidt alleged he contracted coal
workers’ pneumoconiosis while working at Sapphire, with a last date of exposure
on June 15, 2012. He filed his claim for
benefits on December 21, 2015. The ALJ
rendered an Opinion awarding income benefits on July 28, 2017.
In the July 28, 2017 Opinion, the ALJ
determined Wurschmidt is entitled to a 25% disability rating pursuant to KRS
342.732(1)(b)1. The award of income
benefits was commenced on June 15, 2012, Wurschmidt’s last date of
exposure. The ALJ further ordered all
unpaid installments shall carry an interest rate of 6%.
Wurschmidt petitioned for reconsideration,
pointing out that the pre-judgment interest rate set forth in KRS 324.040(1)
was amended on June 29, 2017 from 12% to 6%.
Therefore, he argued he is entitled to 12% interest on past-due benefits
prior to June 29, 2017 and 6% thereafter.
The ALJ agreed and, in the September 11, 2017 Order on Reconsideration,
amended the award accordingly.
Sapphire appeals, and argues KRS
342.040(1), as amended effective June 29, 2017, requires the ALJ to assess 6%
interest on all past-due benefits. House
Bill 223 (“HB 223”), enacted by the General Assembly effective June 29, 2017,
changed the legal rate of interest from 12% per annum to 6% per annum. Sapphire cites to the language in Section 5
of HB 223, which reads as follows:
Section 5. Section 2 of this Act shall apply to all worker’s compensation
orders entered or settlements approved on or after the effective date of this
Act.
Sapphire maintains that although the
above language does not appear in the enacted statute, it demonstrates the
intent of the amendment; thus, the ALJ’s interpretation ignores Section 5 of HB
223. It further contends the statute
applies to all awards of worker’s compensation benefits entered on or after
June 29, 2017.
Prior to
June 29, 2017, KRS 342.040(1) read:
All income benefits shall be payable on the regular payday
after seven (7) days after the injury or disability resulting from an occupational disease, with interest
at the rate of twelve percent (12%) per annum on each installment from the time
it is due until paid, except that if the administrative law judge determines
that a denial, . . .
Effective June 29, 2017, the General
Assembly amended KRS 342.040 to read, in relevant part, as follows:
All income benefits shall be payable on the regular payday of
the employer, commencing with the first regular payday after seven (7) days
after the injury or disability resulting from an occupational disease, with
interest at the rate of six percent (6%) per annum on each installment from the
time it is due until paid, . . .
As Sapphire acknowledges, the General
Assembly did not include Section 5 of HB 223 in KRS 342.040 as amended and
enacted. However, it argues the
legislature clearly intended to limit applicability of the amended version of
KRS 342.040(1) only to those awards entered after June 29, 2017.
We recently considered an identical
argument in Lawnco, LLC v. White (Claim No. 2014-69882, WCB January 12,
2018) and we continue to adhere to the rationale expressed therein. In White, we explained that we must
interpret statutes based on their plain language, and cannot import meaning
from external sources when no statutory ambiguity exists. Revenue Cabinet v.
O’Daniel, 153 S.W.3d 815 (Ky. 2005).
The General Assembly did not include the provision contained in Section
5 of HB 223 in the final amended version of KRS 342.040(1). We, therefore, cannot conclude the General
Assembly intended it to apply nonetheless.
Furthermore, application of Section 5 is tantamount to retroactive application
of the statute to unpaid installments that were due prior to June 29,
2017. We may not construe a statute to
be applied retroactively unless expressly so declared. KRS 446.080(3).
The ALJ correctly determined Wurschmidt’s
income benefits were due and payable commencing on June 15, 2012, his date of
last exposure. See Campbell v. Young, 478 S.W.2d 712 (Ky. 1972). See also Sweasy v. Wal-Mart Stores, Inc.,
295 S.W.3d 835, 839, 840 (Ky. 2009)(“the compensable period for partial
disability begins on the date that impairment and disability arise, without
regard to the date of MMI, the worker’s disability rating, or the compensable
period’s duration.”). This determination
has not been appealed.
In Stovall v.
Couch, 658 S.W.2d 437 (Ky. App. 1983), the Court of Appeals clarified that
the interest rate set forth in KRS 342.040(1) is controlled by the date of
accrual and not by the date a judgment is rendered. Therefore, Wurschmidt’s entitlement to income
benefits vested at the date of his last exposure. Therefore, as of the date of his injury until
June 28, 2017, Wurschmidt is entitled to 12% interest on all unpaid
benefits. He is entitled to 6% interest
on income benefits accrued from and after June 29, 2017.
Accordingly, the July 28, 2017 Opinion,
Award and Order and the September 11, 2017 Order on Reconsideration rendered by
Hon. R. Roland Case, Administrative Law Judge, are hereby AFFIRMED.
ALL CONCUR.
COUNSEL
FOR PETITIONER:
HON SARAH K MCGUIRE
PO BOX 351
PIKEVILLE, KY 41502
COUNSEL
FOR RESPONDENT:
HON C PHILLIP WHEELER JR
5055 N MAYO TRAIL
PIKEVILLE, KY 41501
KENTUCKY
COAL FUND C/O KEMI:
HON MARGARET P DEMOVELLAN
250 WEST MAIN ST, STE 900
LEXINGTON, KY 40507
ADMINISTRATIVE
LAW JUDGE:
HON R. ROLAND CASE
PREVENTION PARK
657 CHAMBERLIN AVENUE
FRANKFORT, KY 40601