East Coast Freight Lines, Inc. v. Harris

Moore, J., delivered the opinion of the Court. This appeal in a workmen’s compensation case involves a procedural question rather than the merits of the employee-appellee’s claim. At issue is whether or not the Workmen’s Compensation Commission, after a hearing, properly vacated an automatic Award of Compensation for temporary total disability, i.e., an award made without a hearing after the filing of the employee’s claim, where the insurer did not present “Issues” until three days after the award and some ten days after the “Consideration Date” designated by the Commission. 1 The Circuit Court for Baltimore County (MacDaniel, J.) had this question before it during a jury trial upon an appeal by the employee from an Order of the Commission vacating the Award of Compensation. After two days of trial, during which the testimony was substantially concerned with whether or not the appellant was the employer, the court ²⁵⁸ declared a mistrial.

Subsequently, the court adopted an Order rescinding the Order appealed from and affirmed the Commission’s original Order. It also “reinstated” the Commission’s finding in the Award of Compensation that the claimant was an employee of the appellant on the date of the accidental injury. The court’s Order was unaccompanied by an opinion or memorandum setting forth its reasons. It is clear from the record, however, that its action was based upon the provisions of the Annotated Code of Maryland, Art. 101, § 56 (e) (1957, 1964 Repl.

Vol.) entitled “Motion for rehearing of decision of Commission,” which provides that a motion for a rehearing may be filed within a prescribed time and “only upon grounds of error of law, or newly discovered evidence.” In our judgment § 56 (e) was not applicable and, for the reasons set forth, we reverse. I The appellee, Ray L. Harris, a truck driver earning $800 per week, was injured in an accident on October 23, 1974, and the significant sequence of events thereafter is reflected by the following chronology: (a) November lb, 197b Mr. Harris filed an employee’s claim on a form provided by the Workmen’s Compensation Commission. At the bottom of the form in a “box” reserved for Commission use only, the following appeared: “Consideration Date: Unless a request for hearing is received by the Commission on or before December 2, 1974 an Order will be passed upon the evidence in the hands of the Commission. Any request for hearing shall be filed with the Commission in accordance with Rule No. 9B of the Rules of Procedure.” (b) November 22, 197b The Commission addressed a form entitled “Notice to Employer” to East Coast Freight Lines ²⁵⁹ stating that: (1) Commission records disclosed that it did not carry workmen’s compensation insurance; 2 (2) if this information was incorrect, East Coast should immediately contact its insurer who must file “the proper records” on or before the consideration date listed on the claim form; (3) if Commission records were correct and the employer was uninsured but desired to contest the claim, it was required to notify the Commission in writing on or before the consideration date; and (4) if appellant did nothing, “An award will be passed based upon the information supplied on the attached claim form, ” and East Coast, as an uninsured employer, would be assessed a penalty in accordance with Art. 101, § 91.

(c) November 26, 1974 East Coast Freight Lines replied by certified mail to the November 22, 1974 notice, advising that it was insured and that the insurer was the Midland Insurance Company of New York. It also stated that the company’s files contained no report of personal injury submitted by the appellee and that the insurer had been requested to contact the Commission to take appropriate action. The letter concluded: “We shall await your further advice.” (d) December 9, 1974 The Workmen’s Compensation Commission by Daniel T. Doherty, Chairman, rendered an Award of Compensation on an official form of the Commission, finding temporary total disability and ordering that East Coast Freight Lines pay $102.30 per week during the continuance of the temporary total disability of the claimant, beginning October 27, 1974, subject to further determination by the Commission as to whether the claimant sustained any permanent disability. In addition, as a ²⁶⁰ non-insured, East Coast was assessed $150 plus an additional assessment of 15% of the Award and of any subsequent awards that might be made, not to exceed the sum of $1500.

The Order was said to be “based on the evidence in the record but [the Commission] will reserve the right of both parties to have the issue of average weekly wage adjudicated at the time a hearing is held.” (e) December 12, 197k “Issues” were filed on the form prescribed by the Commission, executed by an official of Midland Insurance Company, Towson, Maryland, with copies to the claimant and to East Coast Freight Lines, Inc., a subsidiary of Smith and Solomon, Inc., New Brunswick, New Jersey. Seven separate issues were designated on the printed form, the first of which was whether the claimant was an employee of appellant on October 23, 1974, “or was he an employee of Edwin McDonald Jenkins?” The seventh item designated was, “Such other and further issues as may be raised at the time of hearing.” (f) December 13, 197k The Commission issued a form entitled “Notification of Correction,” listing the name of the insurance carrier and reciting, opposite the words “Consideration Date,” the following: “HEARING REQUESTED BY INSURER.” Under the caption, “Remarks,” the form stated: “Certification of Insurance not received until December 13,1974.” (g) February 25, 27, 1975 Workmen's Compensation Commission hearings were held at Baltimore before G. Howlett Cobourn, Commissioner, on the following issues: (1) Claimant’s motion based upon § 56 (e) of Art. 101; 3 ²⁶¹ (2) Was the claimant an employee of East Coast Freight Lines, Inc. or of Edwin McDonald Jenkins on October 23, 1974?; (3) Was East Coast Freight Lines, Inc. the employer and was Midland Insurance Company the insurer of claimant on October 23,1974? (h) April 16, 1975 The above issues were decided against the claimant and an Order was signed by Commissioner Cobourn, in which the Commission’s Order of December 9, 1974 was “rescinded and annulled” and the claim for compensation was disallowed. The reasons for the Commission’s disposition of the employee’s contention under Art. 101, § 56 (e) were not stated.

Mr. Harris thereafter filed an appeal to the Circuit Court of Baltimore County pursuant to Art. 101, § 56 (a) and prayed a jury trial. In his Petition he contended that the Commission erred in its evidentiary findings and in its interpretation of § 56 (e) of Art. 101. The trial commenced on June 16, 1976 and, as previously indicated, on June 17 a mistrial was declared. Thereafter, on July 9, 1976, the lower court signed an Order providing, inter alia: “[T]hat the decision of the Workmen’s Compensation Commission dated April 16, 1975 is hereby rescinded and annulled and further that the