N.B. Cruz v. WCAB (Clemens Family Corp. and Liberty Ins. Corp.) ( 2016 )


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  •            IN THE COMMONWEALTH COURT OF PENNSYLVANIA
    Nalda Batista Cruz,                     :
    Petitioner     :
    :
    v.                          :   No. 2452 C.D. 2015
    :   Submitted: July 1, 2016
    Workers’ Compensation Appeal            :
    Board (Clemens Family Corporation       :
    and Liberty Insurance Corporation),     :
    Respondents     :
    BEFORE: HONORABLE P. KEVIN BROBSON, Judge
    HONORABLE MICHAEL H. WOJCIK, Judge
    HONORABLE JAMES GARDNER COLINS, Senior Judge
    OPINION NOT REPORTED
    MEMORANDUM OPINION
    BY JUDGE BROBSON                            FILED: September 1, 2016
    Petitioner Nalda Batista Cruz (Claimant) petitions for review of an
    order of the Pennsylvania Workers’ Compensation Appeal Board (Board). The
    Board affirmed the decision of a Workers’ Compensation Judge (WCJ), denying
    Claimant’s penalty petition against Clemens Family Corporation (Employer). For
    the reasons set forth below, we reverse the Board’s order and remand the matter for
    further proceedings.
    On April 4, 2012, Claimant sustained a lumbar injury while working
    for Employer.    Employer accepted that injury pursuant to a compromise and
    release agreement (C&R), which WCJ Cathleen Sabatino approved by her decision
    circulated on June 7, 2013. The C&R provided for a payment by Employer to
    Claimant of $62,500 (less $12,500 in counsel fees) in satisfaction of Claimant’s
    disability claim. With respect to medical bills, the C&R provided:
    Employer shall either pay, per the Act, medical bills
    totaling $30,000 or medical bills for treatment provided
    on or before December 1, 2013, whichever comes first.
    In no event shall Employer’s liability for medical bills
    exceed $30,000, regardless of the treatment that may be
    provided or the amounts that may be billed. In no event
    shall Employer be responsible for the payment of bills for
    the treatment provided on or after December 2, 2013,
    regardless of when, where or why such treatment might
    be provided. Claimant understands and agrees that
    Employer may pay less than $30,000 or that Employer’s
    liability for payment of medical bills may end prior to
    December 1, 2013.         In the event that, as of
    December 2, 2013, Employer has paid less that [sic]
    $30,000 for medical treatment, Employer shall promptly
    pay the difference to Claimant. No attorney’s fee shall
    be deducted from this payment.
    (Reproduced Record (R.R.) 54a.)
    On or about July 24, 2014, Claimant filed a penalty petition, alleging
    that Employer failed to pay Claimant for her medical bills in accordance with the
    C&R. Employer paid $18,350.13 for Claimant’s medical treatment from the onset
    of her injury through December 1, 2013. Employer paid Claimant an additional
    $11,649.87 (the difference between the $30,000 cap in the C&R and the total
    amount Employer paid for Claimant’s medical treatment). Claimant argues that
    Employer’s payment to Claimant under the medical treatment payment provision
    of the C&R should have been greater. She contended that the $30,000 cap applied
    only to medical bills paid from the date of the C&R up to December 1, 2013, and
    did not include bills that Employer had already paid. From the date of the C&R to
    December 1, 2013, Employer paid only $5,758.38 in medical bills. The difference
    between that amount and the $30,000 cap is approximately $24,241.62, to which
    Claimant claims she was entitled under the terms of the C&R. As Employer
    remitted to Claimant only $11,649.87, Claimant alleged that she was owed the
    2
    balance of $12,591.75.       Based upon that contention, Claimant asserted that
    Employer failed to comply with the medical treatment payment provision in the
    C&R and sought penalties from Employer for an alleged violation of
    Section 435(d) of the Workers’ Compensation Act (Act).1
    WCJ Brian Puhala conducted a hearing on Claimant’s penalty
    petition. WCJ Puhala’s written decision included findings of fact, confirming the
    all of the payments above, with the exception of the amount Employer paid toward
    Claimant’s medical bills between the date of the C&R and December 1, 2013.
    WCJ Puhala rejected Claimant’s proffered reading of the medical treatment
    payment provision of the C&R, reaching the following relevant legal conclusions:
    3. The language of the [C&R] is the exclusive source of
    the terms between the parties;
    4. The clear language of the [C&R] provides [that
    Employer] would pay medical bills for Claimant’s
    work injury through December 1, 2013, subject to a
    $30,000 ceiling. There is no language in the [C&R]
    stating that this obligation began as of the date of the
    [C&R] or the approval thereof, as argued by
    Claimant;
    5. Claimant’s argument that the $30,000 ceiling began
    as of 6/6/2013 is not supported by language in the
    [C&R].
    (WCJ Puhala decision at 4; R.R. at 19a.)
    Claimant appealed to the Board, arguing that WCJ Puhala erred by
    failing to find a latent ambiguity in the medical treatment payment provision of the
    C&R based on parole evidence—that being Claimant’s testimony as to her
    1
    Act of June 2, 1915, P.L. 736, added by the Act of February 8, 1972, P.L. 930, as
    amended, 77 P.S. § 991(d).
    3
    understanding of what the provision meant. The Board, however, concluded that
    the C&R did not contain ambiguous language or language that is susceptible to
    different constructions. (Board Op. at 4.) Based upon that view, the Board opined
    that the parol evidence rule did not apply and affirmed WCJ Puhala’s decision.
    Claimant petitioned for review of the Board’s order,2 raising the
    following issues: (1) whether WCJ Puhala and the Board erred as a matter of law
    in concluding that the parol evidence rule does not apply; and (2) whether WCJ
    Puhala and the Board erred in failing to address Claimant’s testimony, which, he
    contends, provides evidence that a latent ambiguity exists in the C&R.
    “[A] compromise and release agreement only extinguishes liability
    which is claimed to exist under the Act where the person with the claim
    specifically agrees to relieve the liable person from that liability.” Gingerich v.
    Workers’ Comp. Appeal Bd. (U.S. Filter), 
    825 A.2d 788
    , 791 (Pa. Cmwlth.),
    appeal denied, 
    839 A.2d 354
     (Pa. 2003). When construing contracts to determine
    the intent of the parties, courts must consider first the words of the contract, and
    when the words are clear and unambiguous, courts must rely upon the express
    language of the agreement to find intent. Crawford v. Workers’ Comp. Appeal Bd.
    (Centerville Clinics), 
    958 A.2d 1075
    , 1083 (Pa. Cmwlth. 2008).                    A latent
    ambiguity, however, may arise from collateral circumstances, rendering the
    meaning of what was perceived to be an unambiguous writing uncertain.
    Krizovensky v. Krizovensky, 
    624 A.2d 638
    , 643 (Pa. Super. 1993). Courts regard
    2
    Our review is limited to considering whether an error of law occurred, whether any
    constitutional rights were violated, and whether necessary factual findings are supported by
    substantial evidence. 2 Pa. C.S. § 704.
    4
    the express language of a contract as sufficiently clear and, thus, binding, when the
    terms of the agreement are not susceptible to more than one interpretation.
    Amerikhol Mining, Inc. v. Mount Pleasant Twp., 
    727 A.2d 1179
    , 1182 (Pa.
    Cmwlth. 1999). If, on the other hand, the terms of a contract give rise to more than
    one reasonable interpretation, courts are free to consider extrinsic evidence,
    including parol evidence, which may resolve the ambiguity. 
    Id.
    Turning to the language of medical treatment payment provision in
    the C&R, we agree with WCJ Puhala’s and the Board’s assessment that the
    provision is not ambiguous on its face. Under the provision, Employer “shall pay”
    Claimant’s medical bills up to December 1, 2013, or up to maximum amount of
    $30,000.00, whichever first occurs.      To the extent that Employer’s medical
    payments are less than $30,000.00 as of December 2, 2013, Claimant is entitled to
    a payment from Employee of the difference. This much seems clear. It was not
    until Employer actually paid Claimant “the difference” that, in Claimant’s view, a
    latent ambiguity in the provision arose as to what medical payments by Employer
    should count toward the $30,000 cap. That latent ambiguity is founded, at least in
    part, on the absence of any language in the provision that specifically addresses the
    date on which Employer’s liability for medical treatment payments under the
    provision begins for purposes of applying payments toward the $30,000.00 cap.
    We, however, disagree with both WCJ Puhala and the Board that
    there is no language in the C&R that supports Claimant’s preferred interpretation
    of the medical treatment payment provision. The first sentence of the medical
    treatment payment provision of the C&R provides: “Employer shall either pay,
    per the Act, medical bills totaling $30,000 or medical bills for treatment provided
    on or before December 1, 2013, whichever comes first.” (Emphasis added.) Use
    5
    of the phrase “shall . . . pay” suggests a command to act in the future, supporting
    Claimant’s proffered interpretation that only medical treatment that Employer paid
    pursuant to the C&R and thus after the parties executed the C&R should be applied
    toward the $30,000 cap.
    We conclude that Claimant has proffered a reasonable, alternative
    construction of the medical treatment payment provision in the C&R to that
    Employer advances and upon which Employer based its $11,649.87 payment to
    Claimant. Accordingly, we reverse the Board’s order and remand the matter to the
    Board with the direction to remand the matter to the WCJ for additional
    proceedings, as needed, in order to determine the intent of the parties with regard
    to the medical treatment payment aspect of the C&R and to render a decision on
    Claimant’s penalty petition.
    P. KEVIN BROBSON, Judge
    6
    IN THE COMMONWEALTH COURT OF PENNSYLVANIA
    Nalda Batista Cruz,                      :
    Petitioner      :
    :
    v.                           :   No. 2452 C.D. 2015
    :
    Workers’ Compensation Appeal             :
    Board (Clemens Family Corporation        :
    and Liberty Insurance Corporation),      :
    Respondents      :
    ORDER
    AND NOW, this 1st day of September, 2016, the order of the
    Workers’ Compensation Appeal Board (Board) is REVERSED. The matter is
    REMANDED to the Board with the direction to remand the matter to the Workers’
    Compensation Judge for further proceedings as required.
    Jurisdiction relinquished.
    P. KEVIN BROBSON, Judge
    

Document Info

Docket Number: 2452 C.D. 2015

Judges: Brobson, J.

Filed Date: 9/1/2016

Precedential Status: Precedential

Modified Date: 9/1/2016