PATRICIA COMBS v. BRADLEES/NJSIGA

 

NOT FOR PUBLICATION WITHOUT THE

APPROVAL OF THE APPELLATE DIVISION

SUPERIOR COURT OF NEW JERSEY

APPELLATE DIVISION

DOCKET NO. A-3816-04T53816-04T5

PATRICIA COMBS,

Petitioner-Respondent,

v.

BRADLEES/NJSIGA,

Respondent-Appellant.

_______________________________________

 

Submitted September 26, 2005 - Decided

Before Judges Lintner, Parrillo and Gilroy.

On appeal from the New Jersey Department of Labor, Division of Workers' Compensation.

McElroy, Deutsch, Mulvaney & Carpenter, attorneys for appellant, NJSIGA (Anthony C. Famulari, of counsel; Robert L. Ghelli and David S. Rich, on the brief).

Devlin, Cittadino & Shaw, attorneys for respondent (Paul A. Devlin, on the brief).

PER CURIAM

This is a workers' compensation case. Respondent, New Jersey Self-Insurers Guaranty Association (Association) appeals from the February 18, 2005, order of the Division of Workers' Compensation (Division) directing the Association to: 1) pay petitioner, Patricia Combs, the unpaid balance of permanent partial disability benefits pursuant to the Division's September 9, 2002, order approving settlement; and 2) place the matter on the Association's "list to address issues pertaining to the [Association's] obligation for payment of further medical treatment." For reasons hereinafter expressed, we affirm.

Petitioner, an employee of Bradlees, a self-insured employer for workers' compensation claims, N.J.S.A. 34:15-77, injured herself while in the course and scope of her employment on September 25, 2000. Bradlees accepted compensability of the accident, and paid both temporary disability benefits and petitioner's medical treatment. On September 26, 2000, Bradlees filed a Chapter 11 petition for reorganization under the U.S. Bankruptcy Code, 11 U.S.C.A. 1101 to 1174. A third-party administrator continued to provide medical treatment and paid temporary disability benefits under the bond posted by Bradlees. In January 2001, petitioner filed her claim petition, naming Bradlees as respondent.

On March 13, 2001, Bradlees, as debtor in possession, served petitioner with a notice of the bankruptcy proceeding listing her claim as liquidated and unsecured in the amount of "$0.00." The notice advised that the Bankruptcy Court had entered a "Bar Date Order" establishing April 30, 2001, as "the last date . . . for the filing of proofs of claim against Bradlees." The notice further advised that anyone who had a claim against Bradlees that "arose prior to December 26, 2000[,]" was required to file a proof of claim with the court unless: "Your claim is listed on the Debtors' Schedules[,] . . . is not described as 'disputed,' 'contingent,' or 'unliquidated,' and you do not dispute the amount or nature of your claim as set forth in the Debtors' Schedules[.]" Petitioner did not file a proof of claim.

On September 9, 2002, the Division approved a settlement of petitioner's claim for a 42-1/2% partial disability entitling petitioner to receive 255 weeks of permanent partial disability benefits at $155.63 per week for a total of $39,685.65. Petitioner received weekly benefits under the bond until February 2004, when the bond was exhausted. Petitioner is still owed additional benefits in accordance with the order approving settlement.

On March 8, 2004, petitioner filed a motion for medical and temporary disability benefits seeking further medical treatment. On or about March 18, 2004, the Association served petitioner with a proof of claim which was completed and returned by the petitioner. On May 14, 2004, petitioner filed a formal motion to enforce the order approving settlement. The Association denied the claim on the basis that petitioner had failed to file a proof of claim with the Bankruptcy Court as required by N.J.S.A. 34:15-120.18a.

After filing the motion, petitioner filed an amended claim petition naming the Association as an additional respondent. Petitioner later filed a second claim petition naming the Association as sole respondent. On February 18, 2005, Judge Ricciardelli rendered a written decision and order on the motion against the Association from which the Association now appeals.

On appeal, the Association argues that: 1) the Division lacked subject matter jurisdiction to determine whether the Association improperly denied benefits under N.J.S.A. 34:15-120.18a; and 2) the judge erroneously interpreted the statute by not requiring the petitioner to have filed a proof of claim in the bankruptcy proceeding before being entitled to receive benefits under the statute.

SUBJECT MATTER JURISDICTION.

The Association argues that the Legislature never intended for the Association to be named as a respondent in a workers' compensation action in place of a bankrupt employer. In support of its argument, the Association notes that its actions are controlled by the Department of Banking and Insurance, not by the Department of Labor. N.J.S.A. 34:15-120.15 to -120.19. Petitioner counters that if the Legislature had intended enforcement of claims against the Association to be venued in the Law Division, rather than in the Division, the Legislature would have provided for such alternative review, citing N.J.S.A. 34:15-120.4, which provides for appeal to this court from decisions concerning claims against the "uninsured employer's fund." We agree with petitioner.

N.J.S.A. 34:15-120.18a provides in part:

The Association shall be deemed the insolvent member for purposes of chapter 15 of Title 34 of the Revised Statutes to the extent of its obligation on the covered claims and, to that extent, shall have all rights, duties and obligations of the insolvent member as if the member had not become insolvent.

One of the powers of the Association is to "[s]ue or be sued." N.J.S.A. 34:15-120.18b(3). We conclude based on the cited statutes that the Association may be named as a respondent in an action filed in the Division in place of an insolvent employer.

The Association also contends that the act of construing the statute is a legal determination that may only be made by a Judge of the Law Division, not by a Judge of the Division, and that "[a]ny reasonable doubt of the existence of a particular power in the Division is to be resolved against such power." Conway v. Mister Softee, Inc., 51 N.J. 254, 258 (1968). At oral argument on the motion, the Association relied on two unreported Appellate Division opinions of Dooley v. New Jersey Self-Insurers Guaranty Association, No. A-2781-97 (App. Div. Dec. 28, 1998) (Dooley I), and Dooley v. New Jersey Self-Insurers Guaranty Association, No. A-3930-99 (App. Div. Apr. 9, 2001) (Dooley II), where this court decided appeals from decisions entered in the Law Division, construing the statute, and the jurisdiction of the Law Division was not challenged.

Petitioner argues that statutory basis for jurisdiction in the Division is set forth in N.J.S.A. 34:15-49, which provides in part that "[t]he Division of Workers' Compensation shall have the exclusive original jurisdiction of all claims for workers' compensation benefits under this chapter." Petitioner argues that the challenged statute falls within Chapter 15 and, therefore, the Division has jurisdiction to construe it. As to Dooley I and Dooley II, petitioner notes that the issue of jurisdiction was never raised therein, and therefore, the two cases cannot be cited as precedent for the principle that only the Law Division has jurisdiction to construe the statute. We agree.

The issues before this court in Dooley I and Dooley II (discussed infra) did not concern jurisdiction of the Law Division. Neither party questioned the inherent authority of the Law Division to construe the statute. Clearly, the Law Division has such jurisdiction. N.J.S.A. 2A:16-52. Here, however, the question presented involves the opposite side of the coin. The question on appeal is whether the Division, not the Law Division, has jurisdiction.

Generally, the Division concerns itself with issues of compensability, or benefits to which an employee may be entitled "for personal injuries to, or for the death of, such employee by accident arising out of and in the course of [his or her] employment." N.J.S.A. 34:15-7 and -49. However, the Division also has "such jurisdiction 'as is by fair implication incident to the authority expressly granted.'" Macysyn v. Hensler, 329 N.J. Super. 476, 481 (App. Div. 2000) (quoting Conway, supra, 51 N.J. at 258). Accordingly, we conclude that there is concurrent jurisdiction in both the Law Division and the Division to construe the statute. See Singer Shop-Rite, Inc. v. Rangel, 174 N.J. Super. 442, 446 (App. Div.), certif. denied, 85 N.J. 148 (1980) (holding that "[w]here a genuine question of jurisdiction, exclusive, primary or concurrent is involved," in a workers' compensation claim, "there is no statutory injunction against the trial on that issue in either forum").

CONSTRUCTION OF THE STATUTE.

The Association argues that the judge erred in his construction of N.J.S.A. 34:15-120.18a, deciding that because Bradlee's bond was exhausted, the Association was required to pay petitioner her workers' compensation benefits, notwithstanding that she failed to file a proof of claim in the bankruptcy proceeding. The statute reads in pertinent part as follows:

a. Upon creation of the Insolvency Fund pursuant to the provisions of section 5 of this act, the association is obligated for payment of compensation under chapter 15 of Title 34 of the Revised Statutes to insolvent members' employees resulting from: (1) incidents and injuries existing prior to the member becoming an insolvent member; and (2) incidents and injuries occurring after the member has become an insolvent member, if the employee makes timely claim for those payments according to procedures set forth by a court of competent jurisdiction over the delinquency or bankruptcy proceedings of the insolvent member.

[N.J.S.A. 34:15-120.18a.]

The issue presented requires a review of two contrary positions that generally co-exist, creating an inherent tension, when a fund is established within social legislation to provide payments to injured parties. The first is that the Legislature intended the entity entrusted with management of the fund to be chary in screening claims in order to conserve the fund's resources to assure future payments. "[T]he [L]egislative desire to assist claimants cannot be, and is not intended to be, bureaucratic benevolence." Carpenter Tech. Corp. v. Admiral Ins. Co., 172 N.J. 504, 515 (2002). "The conservation of resources is a major role." Ibid.

The opposite view is that where a fund exists within remedial social legislation, the laws governing the fund should be "given a liberal construction in order 'to . . . afford[] coverage to as many [claimants] as possible.'" Auletta v. Bergen Ctr. for Child Dev., 338 N.J. Super. 464, 470 (App. Div.), certif. denied, 169 N.J. 611 (2001) (quoting Brower v. ICT Group, 164 N.J. 367, 373 (2000)).

The Association contends that the requirement to file a claim in the bankruptcy proceeding applies to both classifications of claimants in the statute and does not depend on whether a claimant's injury arose prior or subsequent to the employer becoming insolvent. Petitioner argues that the statute creates two classes of claimants, those injured before and those injured after the employer's insolvency, and that the requirement of filing a claim with the bankruptcy court only applies to the second class of employees.

In support of its contention, the Association again relies on Dooley I and Dooley II. In Dooley I, similar to the present matter, petitioner suffered a work-related injury while employed by a self-insured employer. Dooley received temporary disability benefits until his employer filed for bankruptcy. As with the present matter, the Division entered a settlement order resolving Dooley's claim. In the year following the settlement order, the Association was created to pay claims of insolvent employers to the extent that their own bonds had been exhausted. The Association denied Dooley's claim because he had failed to file a proof of claim in his employer's bankruptcy proceeding. Dooley commenced an action in the Law Division to compel the Association to pay his claim. The Law Division granted summary judgment to the Association, and Dooley appealed. Dooley argued the same as the petitioner argues here. A different panel of this court rejected Dooley's argument and affirmed the Law Division's summary judgment order determining that the condition of filing a timely claim in the bankruptcy action applies to both classes of claimants under the statute.

The case was remanded for further development of the record to determine whether Dooley should have filed a proof of claim during his employer's bankruptcy proceeding. Unlike the present claim, there is nothing in Dooley I or Dooley II to indicate whether Dooley's claim had ever been scheduled in the bankruptcy proceeding. On remand, the parties stipulated that Dooley knew of his employer's bankruptcy, had notice of the requirement to file a proof of claim, and had adequate time to have done so. The trial court held that Dooley had offered no basis for the court to conclude that he was absolved of the responsibility to file a proof of claim, and again granted summary judgment to the Association. On appeal, this court affirmed. Dooley II, supra.

An unpublished opinion does not constitute precedent nor is it binding upon us unless it is required to be followed by reason of res judicata, collateral estoppel, the single controversy doctrine, or similar principle of law. R. 1:36-3. However, the rule permits an unpublished opinion to be called to a trial court's attention as secondary research so long as the party using the unpublished opinion provides all parties and the court with a copy of the full text of the opinion, as well as any other favorable and unfavorable relevant unpublished material known to exist. Falcon v. American Cyanamid, 221 N.J. Super. 252, 261 n.2 (App. Div. 1987). Petitioner does not assert that the Association failed to provide copies of the two unreported decisions or of any other relevant unpublished opinions. Instead, petitioner contends that the judge correctly determined that the unreported decisions are not binding. We concur.

In construing a statute, the function of a court is to determine the intent of the Legislature and, "generally the best indicator of that intent is the statutory language." DiProspero v. Penn, 183 N.J. 477, 492 (2005). "A clear and unambiguous statute is not open to construction or interpretation . . . ." Watt v. Mayor & Council of Franklin, 21 N.J. 274, 277 (1956). "Such a statute is clear in its meaning and no one need look beyond the literal dictates of the words and phrases used for the true intent and purpose in its creation." Ibid. It is not the function of a court to "presume that the Legislature intended something other than that expressed by way of the plain language." O'Connell v. State, 171 N.J. 484, 488 (2002). "Our analysis, therefore, begins with the plain language of the statute." DiProspero, supra, 183 N.J. at 493.

A general rule of statutory construction is that a modifying phrase applies to the last antecedent phrase, absent contrary intent. State v. Santomauro, 261 N.J. Super. 339, 345 (App. Div. 1993). However, the use of a "comma" to separate a modifier from an antecedent phrase indicates an intent to apply the modifier to all previous antecedent phrases. N.J. Bank v. Palladino, 77 N.J. 33, 45 (1978). In this matter, we are confronted with a "semicolon" after the first antecedent phrase, and a "comma" after the second antecedent phrase and before the modifying phrase. A "semicolon" is a punctuation mark used to denote a degree of separation greater than the comma but less than the period. See Webster's II New Riverside University Dictionary 1060 (3d ed. 1994). Where a semicolon is used to separate two antecedent phrases, the application of the modifying phrase to those antecedents is affected. A semicolon in an antecedent phrase is commonly interpreted to separate that phrase from a subsequent modifying phrase. Van Wart v. Gregory's Garage, 6 N.J. Misc. 838, 840 (Dep't Labor 1928) (a semicolon indicates a "separation in the relations of the thought" and sets off one phrase from another). Accordingly, we determine the general rules of statutory construction support the judge's interpretation of the statute.

The Association argues as in Dooley I, that the purpose of requiring claimants to file claims in the bankruptcy proceeding is to minimize the financial impact on the Association, because the Association is deemed the assignee of the injured employee and may recoup the sum of its payments from the bankrupt's estate. N.J.S.A. 34:15-120.23. The Association contends such objective applies whether the employee is injured before or after insolvency. While recognizing the rationale behind the argument, we determine that there is equal rationale for the Legislature's intent that the condition of filing a claim in the bankruptcy proceeding should only apply to the workers injured post-insolvency.

Federal bankruptcy law requires an insolvent party to list all creditors at the time of filing of its petition in bankruptcy. 11 U.S.C.A. 521. This includes workers' compensation claims for pre-bankruptcy injuries. The Bankruptcy Code provides that a proof of claim is deemed filed for any claim that appears in the schedules filed in the bankruptcy proceeding except those scheduled as disputed, contingent or un-liquidated. 11 U.S.C.A. 1111(a). Generally, there would be no reason for an employee, injured pre-insolvency, to file a proof of claim, although there would be such a need for an employee injured post-insolvency because his or her claim would not have been scheduled in the original bankruptcy petition.

We recognize that this case is an exception to the general principle because the "notice of bar date" received listed petitioner's claim as having no value. However, the claim was approved for settlement by the Division after the employer filed bankruptcy and the petitioner was receiving benefits from a third-party indemnitor under the bond when she received the "notice of bar date." Under such facts, it would not be unreasonable for petitioner to assume that since she was receiving her benefits from a third-party indemnitor, that receipt of the notice from the bankruptcy court listing her claim as "$0.00" only meant that her employer's estate was not liable for future payment, and therefore, petitioner did not have to file a proof of claim in the bankruptcy proceeding because she would continue to receive payment under the bond. Barring her claim under these facts would run counter to the principle that the Worker's Compensation Act is social legislation that is to be liberally construed. N.J. Prop.-Liab. Ins. Guar. Ass'n v. State, 195 N.J. Super. 4, 11 (App. Div.), certif. denied, 99 N.J. 188 (1984).

Our interpretation of the statute is supported by comparison of the enacted statute to that which was initially proposed, L. 1993 c. 107, 4, which provided in pertinent part:

a. Upon creation of the Insolvency Fund pursuant to the provisions of section 5 of this act, the association is obligated for payment of compensation under chapter 15 of Title 34 of the Revised Statutes to insolvent members' employees resulting from incidents and injuries existing prior to the member becoming an insolvent member and from incidents and injuries occurring within 30 days after the member has become an insolvent member, if the incidents giving rise to claims for compensation occur during the year in which the insolvent member is a member of the association and was assessable pursuant to the plan of operation, and if the employee makes timely claim for those payments according to procedures set forth by a court of competent jurisdiction over the delinquency or bankruptcy proceedings of the insolvent member.

[L. 1993, c. 107 4 (as proposed by Assemb. Anthony Impreveduto) (amended by Assemb. Labor Comm. (May 4, 1992)) (codified as amended at N.J.S.A. 34:15-120.18 (1993)).]

A reading of the proposed language under the general rules of statutory construction calls for the qualifying condition of the employee filing a timely claim in bankruptcy to be applicable to both classes of employees. The qualifying clause was set off from the antecedent clause by a "comma," and therefore, applied to all previous antecedent phrases. N.J. Bank, supra, 77 N.J. at 45. The committee amendment, however, discloses that the Legislature separated the two classes by designating each one with a numerical preface and inserting a "semicolon" between the two classes. We construe the alteration of the proposed statute as intentionally limiting the qualifying clause to the second class of injured employees only. To the extent that Dooley I and Dooley II are to the contrary, we disagree.

 
Affirmed.

The New Jersey Self-Insurers Guaranty Association, N.J.S.A. 34:15-120.16.

N.J.S.A. 34:15-77 provides in part that "[a]ny employer desiring to carry his own liability insurance may make application to the Commissioner of Insurance showing his financial ability to pay compensation. The commissioner, if satisfied of the applicant's financial ability and the permanence of his business, shall by written order exempt the applicant from insuring the whole or any part of his compensation liability." The statute further provides that the commissioner has the "authority to [require and] accept [under certain statutory conditions], as evidence of such ability to pay compensation, . . . (c) a surety bond executed by an association or corporation licensed to do business in this State, provided the surety on any such surety bond undertakes to discharge the applicant's liability under this chapter . . . . "

N.J.S.A. 34:15-120.19.

The committee amendment also eliminated the restriction obligating the Association to cover compensation payments owed to an insolvent member only to those employees who were injured during a year that the employer was a member, and who were injured not later than thirty days after the member became insolvent.

(continued)

(continued)

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A-3816-04T5

December 22, 2005