ARA Health Services and Old Republic Ins. v. Flaz ( 2000 )

COURT OF APPEALS OF VIRGINIA
Present: Judges Willis, Lemons ∗ and Frank
Argued at Chesapeake, Virginia
ARA HEALTH SERVICES AND
OLD REPUBLIC INSURANCE COMPANY
MEMORANDUM OPINION ∗∗ BY
v. Record No. 1660-99-1 JUDGE DONALD W. LEMONS
MARCH 28, 2000
EDITH FLAX
FROM THE VIRGINIA WORKERS' COMPENSATION COMMISSION
S. Vernon Priddy III (Sands, Anderson,
Marks & Miller, on brief), for appellants.
Matthew H. Kraft (Stephen A. Strickler;
Inman & Strickler, P.L.C., on brief), for
appellee.
ARA Health Services and Old Republic Insurance Company
("employer") appeal the decision of the Virginia Workers'
Compensation Commission. On appeal, the employer contends: (1)
the commission erred by holding that it has the authority and
jurisdiction to award retroactive cost-of-living benefits more
than ninety days before the date of the application seeking such
benefits; (2) that the commission erred when it held that it has
the authority and jurisdiction to award retroactive
∗
Justice Lemons prepared and the Court adopted the opinion
in this case prior to his investiture as a Justice of the
Supreme Court of Virginia.
∗∗
Pursuant to Code § 17.1-413, recodifying Code
§ 17-116.010, this opinion is not designated for publication.
cost-of-living benefits for up to 500 weeks of benefits; (3)
that the commission erred when it held that Edith Flax's claim
for cost-of-living benefits was timely under the applicable
statute of limitations; and (4) that the commission erred when
it failed to bar Flax's claim for cost-of-living benefits under
the doctrine of laches. Finding no error, we affirm the
decision of the commission.
I. BACKGROUND
On May 22, 1987, the claimant, Edith Flax, tripped and fell
in an unlit stairwell while working for the employer and
suffered a compensable injury to her right knee. The claim was
accepted and compensation benefits paid for the statutory
period, terminating on January 6, 1997. During this time, the
total amount of compensation benefits paid Flax was $97,135.31.
Flax did not apply for cost-of-living supplements during the 500
weeks that she received compensation.
On June 19, 1997, Flax filed her application seeking
permanent partial disability benefits as well as cost-of-living
supplements in the amount of $19,166.26. Accompanying the claim
was documentation from the Social Security Administration that
Flax had been denied supplemental Social Security income, was
ineligible for Social Security disability and, therefore, had
not received any money from the Administration.
Deputy Commissioner Phillips heard the matter on October 9,
1997 and issued an opinion dated November 10, 1997 awarding Flax
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cost-of-living supplements and denying permanent partial
disability benefits. Employer requested a review of the award,
and the full commission remanded the matter to the hearing
docket because Flax had a pending application for Social
Security benefits. Flax was denied Social Security benefits for
the period for which she sought cost-of-living supplements. The
parties stipulated that the deputy commissioner supervising the
matter on remand could return it to the review docket for
decision upon the record and written submissions that had
followed the original opinion and request for review. The full
commission affirmed the award of cost-of-living supplements.
Employer appeals the commission's award.
II. COST-OF-LIVING SUPPLEMENTS
A. TIMELINESS OF FLAX'S APPLICATION
Employer contends that Flax's application for
cost-of-living supplements was not timely made and if no statute
of limitations is applicable, in the alternative, it contends
that the application was still untimely under the doctrine of
laches. When Flax's accident occurred, Code § 65.1-99.1
governed her entitlement to cost-of-living supplements. These
supplements are not self-executing, see Jewell Ridge Coal Corp.
v. Wright, 222 Va. 68, 71, 278 S.E.2d 820, 822 (1981), however,
and to receive cost-of-living supplements, the claimant must
file an application pursuant to Code § 65.2-708. Code
§ 65.2-708 states, "[n]o such review shall be made after
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twenty-four months from the last day for which compensation was
paid, pursuant to an award under this title . . . ." We agree
with the commission that Flax was clearly within this time frame
when she requested cost-of-living supplements.
Having determined that the applicable statute of
limitations for receiving cost-of-living supplements is found in
Code § 65.2-708 and that Flax brought her claim within the
limitations period, employer's plea of laches must fail and we
do not address the issues of prejudice that it has argued on
appeal. As has been stated,
[n]o principle is better established, or
more uniformly acted on in courts of equity,
than that in respect to the statute of
limitations- equity follows the law- that is
to say, if a legal demand be asserted in
equity, which at law is barred by statute,
it is equally barred in a court of equity;
and if not barred by statute at law, neither
is it barred in equity. Rowe v. Bentley, 29
Gratt. 756-759.
Coles v. Ballard, 78 Va. 139, 149 (1883) (emphasis added); see
United States v. Mack, 295 U.S. 480, 489, 55 S. Ct. 813, 818, 79
L.Ed. 1559 (1935) ("Laches within the term of the statute of
limitations is no defense at law.").
B. RETROACTIVE AWARD OF COST-OF-LIVING SUPPLEMENTS
Even if the application was timely made, employer argues
that pursuant to the ninety-day limitation under the
commission's Rule 13(B) (now Rule 1.2(B)) and the decision of
Bristol Door & Lumber Co. v. Hinkle, 157 Va. 474, 161 S.E. 902- 4 -
(1932), an award of cost-of-living supplements for any period
before ninety days prior to the filing of a request for such
supplements, especially after the claimant waited until her 500
week period of receiving disability benefits ended, is barred
and, if the ninety-day limitation does not apply, Bristol Door
and its progeny bar an award for cost-of-living adjustments for
any period prior to the filing of a request for such
supplements. We disagree.
The time limitations that the employer would apply to bar
the payment of retroactive cost-of-living supplements govern
compensation benefits paid pursuant to the Workers' Compensation
Act, such as temporary total, temporary partial, permanent
partial and permanent total benefits. Employer's argument
confuses cost-of-living supplements with compensation benefits
payable pursuant to the Act and contends that Flax's
cost-of-living benefits should, therefore, be subject to the
same limitations applicable to compensation benefits.
This Court in Commonwealth Dept. of Highways and Transp. v.
Williams, 1 Va. App. 349, 338 S.E.2d 660 (1986), and the
commission, in Rule 1.2(B), have specifically held that the
limitation precluding the award of benefits for more than ninety
days prior to the filing of a claim under Code § 65.2-708 is not
applicable to cost-of-living supplements. We recognized that
the commission "has consistently ruled that cost-of-living
benefits are not compensation within the meaning of Rule 13(B)."
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Williams, 1 Va. App. at 356, 338 S.E.2d at 665. The purpose of
cost-of-living supplements is "to ensure, as much as possible,
that the value of benefits paid under the Act does not diminish
due to inflation." Id. at 354, 338 S.E.2d at 664. We noted
that "Bristol Door was decided long before the Act provided for
cost-of-living benefits" and that the concern there was that "if
claimants could receive retroactive compensation awards
employers might not be given the opportunity to furnish medical
or rehabilitative aid at the time a changed condition came
about." Id. at 356-57, 338 S.E.2d at 665. "Such concerns,
however, are not relevant to cost-of-living entitlements because
the determination whether a claimant is entitled to a
cost-of-living supplement is not based on any actions which the
employer may or may not have taken." Id. at 357, 338 S.E.2d at
665.
Furthermore, within the context of change in condition
applications, the commission, since Williams, has incorporated
Rule 13(B) into Rule 1.2, and in section (B) of that Rule has
specifically stated: "Additional compensation may not be
awarded more than 90 days before the filing of the claim with
the Commission. Requests for cost of living supplements are not
subject to this limitation." Rule 1.2(B), Rules of the Virginia
Workers' Compensation Commission (emphasis added). Accordingly,
retroactive cost-of-living supplements are not limited by Rule
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13(B) or the Supreme Court of Virginia's holding in Bristol
Door.
III. CONCLUSION
For the reasons stated above, we affirm the commission's
award.
Affirmed.
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