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January 15, 2016 201285818

Commonwealth of Kentucky 

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