Philip Electronics North America v. Wright

RAKER, Judge. We are called upon in this case to interpret the Workers’ Compensation Act, Maryland Code (1991 Repl.Vol., 1997 Supp.), Title 9 of the Labor and Employment Article (hereinafter “Act”). 1 We must determine whether, after an award to a claimant is reduced pursuant to a petition for judicial review, the employer is entitled to a credit for the total amount of money paid to the claimant before the reduction of the original award, or whether the appropriate credit is the number of weeks the employer paid benefits prior to the reduction. We shall hold that a credit based upon the number of weeks the employer has paid benefits is proper. I. This case arose out of a knee injury suffered by claimant Patricia Wright (‘Wright”) on February 7, 1990 during the course of her employment.

Subsequently, while attempting to rehabilitate her injured left knee, Wright developed an adverse psychological condition related to her physical injury. Pursuant to those injuries, Wright filed a claim for compensa ²¹³ tion with the Maryland Workers’ Compensation Commission (“Commission”) against her employer, Philip Electronics North America, and its insurer, Travelers Indemnity Company of Illinois (collectively “Philip Electronics”). On November 19, 1992, the Commission conducted a hearing to determine the amount of compensation due Wright under the Act. By written order, on November 30, 1992, the Commission found that Wright had suffered a permanent partial disability loss of 50% of the use of her body as a whole, under “other cases,” due to the injury to her knee and the resulting psychological condition. 2 See § 9-627(k).

Accordingly, the Commission ordered Philip Electronics to pay Wright permanent partial disability benefits at the rate of $178 per week for 333 weeks pursuant to § 9-630. Both Philip Electronics and Wright filed a petition for judicial review in the Circuit Court for Dorchester County. After hearing the evidence, on November 23, 1993, a jury returned a verdict finding that Wright had sustained a 40% loss of the use of her body as a whole as a consequence of the injuries arising out of her employment. Upon remand, on November 17, 1994, the Commission recalculated Wright’s benefits, and found that she was entitled to $144 per week for 200 weeks.

Significantly, the Commission also gave Philip Electronics a credit for the amount of the monetary payments made under the Commission’s original order of November 30, 1992. Aggrieved by the Commission’s decision to allow Philip Electronics a credit for the total amount of monetary benefits paid under the Commission’s original order, Wright filed a second petition for judicial review in the Circuit Court for ²¹⁴ Dorchester County. On September 22, 1995, the circuit court granted Philip Electronics’ motion for summary judgment, also concluding that Philip Electronics was entitled to a credit for the total amount of monetary benefits already paid. Wright subsequently filed a timely notice of appeal to the Court of Special Appeals.

Rejecting the “total monetary” credit approach advocated by Philip Electronics, the intermediate appellate court reversed the judgment of the circuit court. See Wright v. Philip Electronics, 112 Md.App. 642 , 685 A.2d 1216 (1996). This Court then granted Philip Electronics’ petition for writ of certiorari to resolve the primary legal issue presented by this case. We now affirm.

II

Before this Court, Philip Electronics argues that the Court of Special Appeals erred by holding that an employer is entitled only to credit for the number of weeks of benefits paid, rather than a credit for the total monetary sum expended, after an initial award by the Commission has been reduced by the circuit court. Philip Electronics’ argument is primarily an equitable one: It is unjust for a claimant to receive benefits greater than the amount awarded by the trier of fact in a petition for judicial review at the circuit court. To illustrate, Philip Electronics cites the facts of this case. The jury found that Wright suffered a 40% loss of the use of her body as a whole as a consequence of her work-related injuries.

Under the statutory framework, this finding translated into benefits of $144 per week for 200 weeks, for a total of $28,800. At the time of the filing of the petition for judicial review which is the subject of this appeal, Philip Electronics had paid Wright benefits totaling $32,772; and should the Court of Special Appeals’ holding be affirmed, with Philip Electronics consequently obligated to pay 53 more weeks in benefits, the end ²¹⁵ result would be payments totaling $39,600 3 —or $10,800 more than the amount mandated by the jury verdict. Philip Electronics contends this $10,800 overpayment unfairly deprives it of rightful funds, as well as unjustly enriching Wright. Philip Electronics emphasizes it does not wish to “recover back” funds already paid to Wright, but rather wishes only an offset against the debt owed to her consistent with the decision of the jury in this case. 4 In contrast, Wright argues the Court of Special Appeals correctly concluded that, after the reduction of an award by the circuit court, an employer’s credit should be based upon the number of weeks that an employer has paid benefits.

Wright contends the applicable provisions of the Act are written in terms of weeks of disability, thereby implying that this is the appropriate frame of reference to determine the proper credit. Wright also argues that an approach focusing only upon the total amount of money paid to a claimant is inconsistent with the purposes of the Act. We agree with Wright.

III

The Maryland Workers Compensation Act was originally enacted in 1914 to compensate employees for the loss of earning capacity resulting from accidental injury, disease, or ²¹⁶ death occurring during the course of employment. DeBusk v. Johns Hopkins, 342 Md. 432, 437 , 677 A.2d 73, 75 (1996). Under the Act, an employer is liable to an employee for such an injury regardless of fault. § 9-501(b); Great Atlantic Tea v. Imbraguglio, 346 Md. 573, 582 , 697 A.2d 885, 889-90 (1997). Ordinarily, the compensation provided by the Act is the employee’s exclusive remedy for a job-related injury. § 9-509; Hastings v. Mechalske, 336 Md. 663, 672 , 650 A.2d 274, 278 (1994).

As we have repeatedly emphasized, the Act is remedial in nature and “ ‘should be construed as liberally in favor of injured employees as its provisions will permit in order to effectuate its benevolent purposes.’ ” Para v. Richards Group, 339 Md. 241, 251 , 661 A.2d 737, 742 (1995) (quoting Howard Co. Ass’n Retard. Cit. v. Walls, 288 Md. 526, 530 , 418 A.2d 1210, 1213 (1980)); see § 9-102(a). Thus, in interpreting the Act, we do not apply the canon of construction that a statute in derogation of the common law should be strictly construed. § 9-102(b). Moreover, all sections of the Act must be read together, in conjunction with one another, to discern the true intent of the legislature.

Vest v. Giant Food Stores, Inc., 329 Md. 461, 466-67 , 620 A.2d 340, 342 (1993); Ryder Truck Lines v. Kennedy, 296 Md. 528, 537 , 463 A.2d 850, 856 (1983). Of course, we seek to avoid an interpretation which would lead to an untenable or illogical outcome. Greco v. State, 347 Md. 423, 429 , 701 A.2d 419, 422 (1997); Waskiewicz v. General Motors Corp., 342 Md. 699, 708 , 679 A.2d 1094, 1099 (1996); see also Superior Builders, Inc. v. Brown, 208 Md. 539, 543 , 119 A.2d 376, 378 (1956) (“The Act should receive a practical construction, and should be so interpreted and construed as to effectuate its general purpose.”). In construing the Act, as in construing all statutes, the paramount objective is to ascertain and give effect to the intent of the legislature.

Marriott Employees v. MVA, 346 Md. 437, 444 , 697 A.2d 455, 458 (1997); Bowen v. Smith, 342 Md. 449, 454 , 677 A.2d 81, 83 (1996). In interpreting the Act, we apply the following general principles. First, if the plain ²¹⁷ meaning of the statutory language is clear and unambiguous, and consistent with both the broad purposes of the legislation, and the specific purpose of the provision being interpreted, our inquiry is at an end. Marriott Employees, 346 Md. at 445 , 697 A.2d at 458 ; Frank v. Baltimore County, 284 Md. 655, 661 , 399 A.2d 250, 254 (1979); see Polomski v. Baltimore, 344 Md. 70, 75-76 , 684 A.2d 1338, 1340 (1996).

Second, when the meaning of the plain language is ambiguous or unclear, we seek to discern the intent of the legislature from surrounding circumstances, such as legislative history, prior case law, and the purposes upon which the statutory framework was based. DeBusk, 342 Md. at 437 , 677 A.2d at 75 . Last, applying a canon of construction specific to the Act, if the intent of the legislature is ambiguous or remains unclear, we resolve any uncertainty in favor of the claimant. Baltimore v. Cassidy, 338 Md. 88, 97 , 656 A.2d 757, 761-62 (1995); Lovellette v. Baltimore, 297 Md. 271, 282 , 465 A.2d 1141, 1147 (1983).

This Court, however, may not stifle the plain meaning of the Act, or exceed its purposes, so that the injured worker may prevail. Morris v. Board of Education, 339 Md. 374, 384 , 663 A.2d 578, 583 (1995). Similarly, the Court may not create ambiguity or uncertainty in the Act’s provisions where none exists so that a provision may be interpreted in favor of the injured claimant. R & T Construction v. Judge, 82 Md.App. 700, 709 , 573 A.2d 96, 100 (1990), modified, 323 Md. 514 , 594 A.2d 99 (1991).

Bearing these principles in mind, we now turn to the case at hand.

IV

This case presents a straightforward question of law. On November 17,1994, the Commission recalculated the benefits due Wright at $144 per week for 200 weeks, a total sum of $28,800. As of that date, the payments by Philip Electronics to Wright far exceeded $28,800. Yet Philip Electronics had ²¹⁸ only paid benefits to Wright for 147 weeks. 5 Philip Electronics seeks to offset the total payments it has already made to Wright against the sum of $28,800, thus satisfying the amount Philip Electronics owes to Wright pursuant to her claim under the Act.

Conversely, Wright argues that under Maryland law, Philip Electronics is entitled to a credit for 147 weeks of benefits paid, thus entitling her to another 53 weeks of benefits at $144 per week. We conclude the language of § 9-627(k), as well as the language of § 9-629 and § 9-630, clearly and unambiguously demonstrate a legislative commitment to the payment of permanent partial disability benefits within a weekly framework. The purposes sought to be achieved by the Act further reinforce this legislative intent. In addition, Philip Electronics’ argument that the payment to Wright of another 53 weeks of benefits is inequitable, and amounts to an unjust windfall to her, fails when analyzed within the circumstances surrounding the statutory history of the Act.

A. Section 9-627(k) authorized Wright’s award of permanent partial disability benefits in this case. That statutory provision states: (k) Other cases.—(1) In all cases of permanent partial disability not listed in subsections (a) through (j) of this section, the Commission shall determine the percentage by which the industrial use of the covered employee’s body was impaired as a result of the accidental personal injury or occupational disease. (2) In making a determination under paragraph (1) of this subsection, the Commission shall consider factors including: (i) the nature of the physical disability; and ²¹⁹ (ii) the age, experience, occupation, and training of the disabled covered employee when the accidental personal injury or occupational disease occurred. (3) The Commission shall award compensation to the covered employee in the proportion that the determined loss bears to 500 weeks.

(4) Compensation shall be paid to the covered employee at the rates listed for the period in §§ 9-628 through 9-630 of this Part IV of this subtitle. As paragraph (4) of subsection (k) of § 9-627 indicates, the award of permanent partial disability benefits is governed by three independent sections of the Act. Section 9-628, not relevant here, authorizes compensation for less than 75 weeks. Section 9-630, which governs compensation to an injured worker for a period of greater than 250 weeks, authorized Wright’s original award on November 30, 1992 by the Commission.

When Wright’s award was reduced to 200 weeks, that award was granted pursuant to § 9-629, which covers compensation for a period equal to or greater than 75 weeks, but less than 250 weeks. The first specific statutory provision pertinent to this case, § 9-629, reads as follows: § 9-629. Compensation for period equal to or greater than 75 weeks but less than 250 weeks. If a covered employee is awarded compensation for a period equal to or greater than 75 weeks but less than 250 weeks, the employer or its insurer shall pay the covered employee weekly compensation that equals two-thirds of the average weekly wage of the covered employee but does not exceed one-third of the State average weekly wage.

The other statutory provision relevant to the issue we resolve today, § 9-630, states in pertinent part: § 9-630. Serious disability—Compensation for 250 weeks or more. (a) In general.—(1) Except as provided in paragraph (2) of this subsection, if a covered employee is given an award or a combination of awards resulting from 1 accidental personal ²²⁰ injury or occupational disease for 250 weeks or more under § 9-627 of this subtitle: (1) the Commission shall increase the award or awards by one-third the number of weeks in the award or awards, computed to the nearest whole number; and (ii) the employer or its insurer shall pay the covered employee weekly compensation that equals two-thirds of the average weekly wage of the covered employee, but does not exceed 75% of the State average weekly wage. (2) An award for disfigurement or mutilation under § 9-627(i) of this subtitle may not be used to make up the 250 weeks under paragraph (1) of this subsection.

These statutory provisions reflect the intent of the General Assembly that the payment of permanent partial disability benefits be based upon a weekly framework. Of greatest significance, the specific sections governing the payment of benefits, § 9-629 and § 9-630, are distinguished by the number of weeks of compensation awarded. The general statutory provision, § 9—627(k)(3), also states that benefits shall be paid “in the proportion that the determined loss bears to 500 weeks.” Again, the Act emphasizes the weekly nature of an award of benefits. The language of the specific sections of the Act also reinforces the legislative focus upon the weekly nature of the payment scheme.

Both § 9-629 and § 9—630(a)(l)(ii) expressly state that “the employer or its insurer shall pay the covered employee weekly compensation.” Section 9—630(a)(1) speaks of a covered employee being awarded compensation “for 250 weeks or more,” and § 9—630(a)(l)(i) mandates that “the Commission shall increase the award or awards by one-third the number of weeks.” Finally, the Act states that “[a]n award for disfigurement or mutilation under § 9-627(i) of this subtitle may not be used to make up the 250 weeks under paragraph (1) of this subsection.” § 9-630(a)(2) (emphasis added). It is telling that in barring an offset against an award from another subsection of the Act, the General Assembly chose to ²²¹ characterize an award under § 9~630(a) in terms of weeks, rather than as a monetary amount. Writing for the Court of Special Appeals in this case, Judge Fischer correctly reached the identical conclusion: The “weekly credit” approach is consistent with the Act’s benefit structure. It follows naturally that if the compensation structure is expressed in terms of “weeks,” then any credit for previous payments should also be expressed by “weeks.” Wright v. Philip Electronics, 112 Md.App. 642, 649-50 , 685 A.2d 1216, 1219 (1996).

The plain language of the Act leads us to conclude that the Legislature expressed a commitment to the payment of permanent partial disability benefits based on a weekly framework, rather than focusing upon the total monetary value of such an award. See Sturgis v. International Paper Co., 525 So.2d 813, 815 (Miss.1988) (“[T]he credit is for the week, not for a number of dollars, and the excess cannot be carried over as a credit against other weeks of liability.”) (internal quotation marks and citation omitted); General Elect. Co. v. Morris, 670 S.W.2d 854, 856 (Ky.1984) (“By allowing full [dollar-for-dollar] credit, the claimant ... could be deprived of many future periodic payments.”); see also 4 Arthur Larson & Lex K. Larson, Larson’s Workers’ Compensation Law § 57.47, at 10-276—10-278 (1997). A prior decision of this Court, St. Paul Fire & Mar.

Ins. v. Treadwell, 263 Md. 430 , 283 A.2d 601 (1971), supports this interpretation of the Act. Treadwell dealt with the analogous issue of whether an employer could “recover back” monies paid to a claimant after the original award to the worker was reduced by the circuit court. In analyzing the Act as it existed at that time, the Court observed that: while the statute, Code (1964 Repl.Vol.), Art. 101, does not contain explicit language authorizing the recovery by an employer (or its insurer) of payments found on appeal to have been awarded erroneously, neither does it, in so many words, forbid the recovery of such payments. ²²² Id. at 431 , 283 A.2d at 602 . The Court in Treadwell found the existence of the anti-stay provision of the Act determinative to the resolution of the issue presented by that case.

See § 9-741. 6 Our predecessors reasoned that: [W]hen the Legislature enacted the “no stay” provision in [Maryland Code (1964 Repl.Vol.), Art. 101,] § 56(a) it must have foreseen the possibility, and as well the probability, that payments would be made to claimants whose awards subsequently would be vacated on appeal. That it made no provision for the restitution of those payments suggests to us that restitution was considered and rejected, and that, in lieu thereof, the disposition of appeals was expedited by giving them precedence over all cases except