Mona Electric Co. v. Shelton

WILNER, Judge. The principal issue before us in this workers’ compensation case is the construction and applicability of Maryland Code, § 9-736(b)(3) of the Labor and Employment Article (LE), which precludes the Workers’ Compensation Commission from “modifying] an award unless the modification is applied for within 5 years after the last compensation payment.” Petitioner, Mona Electric Company, paid its employee, Wade Shelton, benefits for temporary total disability in the absence of any award from the Commission. More than five years after the last payment, Shelton sought benefits for permanent partial disability. The Commission found the statute applicable and denied his claim.

The Circuit Court for Calvert County and, on appeal, the Court of Special Appeals found the statute inapplicable. We agree with the courts and shall affirm the judgment. BACKGROUND On August 30, 1991, Shelton was injured in an automobile accident while in the course of his employment with Mona. On April 14, 1992 — more than seven months later — he filed a claim for workers’ compensation benefits. 1 On April 29, the Commission sent notice of the claim to Mona.

On May 8, Mona contested the claim by filing “Contesting Issues” with the Commission, the issues, as articulated, being (1) whether Shelton sustained an accidental injury arising out of and in the course of employment, and (2) “such other issues that may ³²³ arise.” Upon that filing, the Commission scheduled a hearing for September 17, 1992. On September 4, Mona notified the Commission that it had withdrawn the contesting issues and asked the Commission to postpone the scheduled hearing. It informed the Commission that it had elected to accept the claim as compensable and that it had begun paying temporary disability benefits, apparently as of the date of the accident. Those payments continued, without the benefit of any award by the Commission, until September 16, 1994, when Mona terminated them because, in Mona’s opinion, Shelton had reached maximum medical improvement.

The last check sent to Shelton for his temporary disability was dated October 3, 1994. In February, 1998, Shelton sought an emergency hearing before the Commission in connection with a request for certain medical benefits. A hearing was scheduled for April 6, but was continued, subject to being reset on request, when both sides informed the Commission that they had resolved the pending issue. In July, 1998, Shelton settled a third-party claim that he had filed, presumably against the driver who caused the accident, and sent Mona’s insurer $15,856 in full satisfaction of its “workers’ compensation lien.” In November, 1999, Shelton filed the claim that precipitated this appeal.

He sought permanent partial disability to his body as a whole. Mona and, upon its being impleaded, the Subsequent Injury Fund raised a number of defenses, including “limitations.” At the request of Mona and the Fund, the Commission considered only the limitations issue, on the theory that, if limitations barred the claim, there was no need to consider any of the other issues. The limitations issue arose from LE § 9-736(b)(3) which, at the time, provided that, with exceptions not relevant here, “the Commission may not modify an award unless the modification is applied for within 5 years after the last compensation payment.” 2 At a hearing held in ³²⁴ September, 2000, Mona urged that, as the last payment of compensation to Shelton was in October, 1994, the request for modification, filed in November, 1999, was outside the limitations period and was therefore barred. Shelton pointed out that there had never been an award, arguing, as a result, that the statute was not applicable, or at least did not bar his claim for permanent disability benefits.

On November 2, 2000, the Commission entered an order declaring that the claim was barred. Shelton filed a petition for judicial review, in response to which Mona and the Subsequent Injury Fund moved for summary judgment on the ground of “limitations” — i.e,, that LE § 9 — 736(b)(3) barred the claim. Shelton filed a cross-motion for summary judgment, arguing that § 9 — 736(b)(3) was inapplicable because he was not seeking to modify an award— no award had ever been entered by the Commission and, thus, there was no award to be modified. Although Shelton regarded the statutory language, requiring that there be an award for the limitations provision to apply, as clear and unambiguous, he urged that, to the extent there was any ambiguity as to whether the statute applied, that ambiguity should be resolved in his favor, given that, as remedial legislation, the Workers’ Compensation Act was to be applied liberally in favor of claimants.

After a hearing, the court found merit in Shelton’s argument and, in a subsequent order, granted his motion, reversed the Commission’s order, and remanded the case to the Commission for further proceedings. The Court of Special Appeals affirmed. Mona Electrical v. Shelton, 148 Md.App. 1 , 810 A.2d 1022 (2002). Following the lead of the Supreme Court in its interpretation of the Longshoremen’s and Harbor Workers’ Compensation Act, 33 U.S.C. § 922 , in Intercounty Construction Corporation v. Walter, 422 U.S. 1 , 95 S.Ct. 2016 , 44 L.Ed.2d 643 (1975), the ³²⁵ intermediate appellate court concluded that § 9 — 736(b)(3) applied only when there was an award that was sought to be modified, a circumstance lacking in this case.

To equate the voluntary payment of compensation with an award entered by the Commission, the court held, would “provide an avenue by which employers could avoid Commission oversight” and thus “defeat the purposes of the Act.” Mona Electrical, 148 Md. App. at 10 , 810 A.2d at 1027 . We granted certiorari to determine whether the two lower courts correctly construed § 9 — 736(b)(3). Mona contends that the term “award,” as used in the statute, is ambiguous and that it should be construed as including payments made by an employer, in response to a claim, upon the employer’s determination that the claim is valid. Such payments, it avers, constitute an “award” by the employer and should be treated the same as payments made pursuant to an award by the Commission.

Any other construction, it complains, would be grossly inequitable and could lead to a flood of unnecessary litigation. Mona also contends that Shelton is equitably es-topped from asserting the bar of § 9 — 736(b)(3) because he willingly accepted the temporary disability benefits, as if there had been a Commission award. DISCUSSION Is The Claim Barred By § 9-736(b)(3)? The issue presented by Mona is purely one of statutory construction: does the limitation in § 9 — 736(b)(3) on the authority of the Commission to modify an “award” apply when the “compensation” previously paid by the employer was not paid pursuant to a Commission “award”?

In construing statutes our mission, as we have said many times, is to “ascertain and implement, to the extent possible, the legislative intent.” Toler v. MVA, 373 Md. 214, 220 , 817 A.2d 229, 233 (2003); Witte v. Azarian, 369 Md. 518, 525 , 801 A.2d 160, 165 (2002). As we pointed out in those cases, we look first to the words of the statute, “on the tacit theory that the Legislature is presumed to have meant what it ³²⁶ •said and said what it meant.” Id. We added, however, that “ ‘if the true legislative intent cannot readily be determined from the statutory language alone,’ we may look to other indicia of that intent, including the structure of the statute, how it relates to other laws, its legislative history, its general purpose, and the ‘relative rationality and legal effect of various competing constructions.’ ” Toler, supra, at 220 , 817 A.2d at 233 (quoting from Witte, supra, 369 Md. at 525 , 801 A.2d at 165 ). One aspect of examining those indicia, we said, “is the presumption, which itself is a rule of construction, that the Legislature ‘intends its enactments ‘to operate together as a consistent and harmonious body of law.’ “ Toler , at 220, 817 A.2d at 233 (quoting from State v. Ghajari, 346 Md. 101, 115 , 695 A.2d 143, 149 (1997) (quoting, in turn, from State v. Harris, 327 Md. 32, 39 , 607 A.2d 552, 555 (1992))).

Shelton looks at the word “award” in § 9-736(b)(3) as essentially the alpha and omega of our quest. If the Legislature meant the statute to apply to situations in which compensation was paid without the benefit of an award, it would have said so. The fact is, he says, that there is no award to be modified, and, consequently, the limitation on the Commission’s authority does not apply. We agree with that analysis and conclusion, both as a matter of technical statutory construction and as indicative of overall legislative intent.

Section 9-736 needs to be read in both an internally coherent way and harmoniously with other relevant statutes. The clear intent of the statute is to give the Commission broad continuing jurisdiction over claims, in order to respond to the improvement or worsening of a claimant’s disability over time. Subsection (a) provides that, if aggravation, diminution, or termination of disability occurs or is discovered after the rate of compensation is set, the Commission may (1) readjust for future application the rate of compensation, or (2) if appropriate, terminate the payments. Subsection (b) contains three provisions.

The first — subsection (b)(1) — gives the Commission “continuing powers and jurisdiction over each claim under this title.”. The second — subsection (b)(2) — provides that, sub ³²⁷ ject to subsection (b)(3), the Commission may “modify any finding or order as the Commission considers justified.” (Emphasis added). Subsection (b)(3) adds that the Commission may not modify “an award” unless the modification is applied for within five years after “the last compensation payment.” The limitation in subsection (b)(3) is only on the modification of an “award.” The ability to modify any other “finding” or “order” made by the Commission, not constituting an “award,” is not dependent on when the last payment of compensation was made. By using different terms in the same section of the same statute, the Legislature is presumed to have intended that the condition of subsection (b)(3) on the Commission’s exercise of the broad power of revision vested in it by subsections (a), (b)(1), and (b)(2) itself have a limited meaning, that it, indeed, be restricted to the modification of an “award.” See Toler v. MVA, supra, 373 Md. at 223 , 817 A.2d at 235 (“It is a common rule of statutory construction that, when a legislature uses different words, especially in the same section or in a part of the statute that deals with the same subject, it usually intends different things.”).

The problem, of course, is that the word “award,” though used frequently in the Workers’ Compensation Act, is not a defined term, and Mona complains about the unfairness and the potential pragmatic ramifications of not treating its payments as though they had been made pursuant to an award. In the end, the answer to Mona’s complaint does lie in the Legislature’s use of the word “award” in § 9-736(b)(3), but the significance of that term and its necessary construction as a Commission award, not a voluntary payment by an employer, becomes particularly apparent when that section is read in harmony with the broader statutory procedure governing the determination of claims, as implemented by the Commission. The statutory procedures and requirements relating to claims are set forth in LE, title 9, subtitle 7 (§§ 9-701 through 9-750). Sections 9-704 through 9-708 impose certain requirements leading up to the filing of a claim — the duty of an injured employee to notify the employer of an accidental ³²⁸ personal injury and the duty of the employer to notify the Commission when the injury causes death or more than three days of disability.

More relevant here are §§ 9-709 through 9-733, which govern the filing of a claim and the post-claim procedure, including the payment of compensation. Section 9-709 provides that, if a covered employee suffers an accidental personal injury, the employee shall file a claim application form with the Commission within 60 days after the injury. Section 9-713 requires the employer, within 21 days after the filing of a claim, either to begin paying temporary disability benefits or to file with the Commission “any issue to contest the claim.” If the employer fails to do one or the other, the Commission may assess a fine against the employer. 3 Section 9 — 713(f) provides that, subject to § 9-714, payment by an employer “before an award” does not waive the employer’s right to contest the claim. Section 9-714 deals with the processing of a claim by the Commission, and it is, for our purposes, one of the more ³²⁹ important provisions.

Subsection (a) provides that, when the Commission receives a claim, it “(1) may investigate the claim; and (2) on application of any party to the claim, shall order a hearing.” Subsection (b) requires the Commission to “make or deny an award” within 30 days “(i) after the claim is filed; or (ii) if a hearing is held, after the hearing is concluded.” The decision must be recorded in the principal office of the Commission. Section 9-722 deals with the settlement of claims. Subsection (a) provides that, after a claim has been filed and subject to the approval of the Commission, a claimant may “enter into an agreement [with an employer] for the final compromise and settlement of any current or future claim under this title.... ” The agreement must contain the terms and conditions the Commission considers proper, and it may not take effect unless approved by the Commission. See § 9 — 722(b) and (c).

Finally, with respect to these initial procedures, § 9-727 provides that an employer “shall begin paying compensation to the covered employee within 15 days after the later of the date: (1) an award is made; or (2) payment of an award is due.” (Emphasis added). Sections 9-713 and 9-722 recognize the essential realities that not every claim is contested and that many of those that are initially contested are resolved either by the employer abandoning the contest or by settlement, without the need for any actual adjudication by the Commission. In some cases, the employer will either not contest the claim at all or, if it initially does challenge the claim by filing contested issues, it will, as Mona did here, withdraw those issues before a hearing. Whether or not the employer contests the claim, the regime clearly intended by the