State Workers' Insurance Fund v. WCAB (Shaughnessy)

In State Workers' Insurance Fund v. Workers' Compensation Appeal Board (Shaughnessy), 837 A.2d 697 (Pa. Cmwlth. 2003), an employee died due to chemical exposure while working for the employer, and the deceased employee's widow filed a fatal claim petition. Shaughnessy, 837 A.2d at 698. The State Workers' Insurance Fund (SWIF) defended against the fatal claim petition. Id. A WCJ granted the fatal claim petition, and SWIF was required to pay benefits to the deceased employee's widow. Id. After SWIF appealed, the Board remanded the matter for a determination as to whether the employer had workers' compensation coverage. Id. Following further proceedings, the parties stipulated that SWIF was not the workers' compensation carrier for the employer during the last period of exposure. Id. at 699. The parties also stipulated that the fatal claim petition should be denied and that SWIF would not seek reimbursement from the deceased employee's widow. Id. Based on the stipulation entered into by the parties, the WCJ denied the fatal claim petition. Id. SWIF subsequently sought reimbursement from the Supersedeas Fund and the Bureau opposed SWIF obtaining reimbursement. Id. A WCJ denied SWIF reimbursement, and SWIF appealed. After further proceedings, the Board ultimately affirmed the WCJ's decision and order denying SWIF reimbursement. Id. SWIF petitioned this Court for review, arguing that the Board and the WCJ had erred in concluding that SWIF was not entitled to reimbursement from the Supersedeas Fund. Id. at 700. In addressing this argument, the Court stated: SWIF was wrongfully told to pay Claimant benefits despite evidence that it was not the insurer. SWIF dutifully paid these benefits and now seeks to have this wrong corrected. Supersedeas Fund reimbursement is only appropriate, however, when it is "determined that such compensation was not, in fact, payable." "The purpose of the supersedeas fund is to provide a means to protect an insurer who makes compensation payments to a claimant who ultimately is determined not to be entitled thereto." That is not what happened in this case. Rather, it was determined, by Stipulation that SWIF should not have paid compensation to Claimant, not that Claimant should never have received any compensation. As such, reimbursement from the Supersedeas Fund is not appropriate. Rather, we believe that the appropriate remedy is for SWIF to file a Review Petition, seek to have Employer joined by filing a Joinder Petition and ask a WCJ to hold Employer responsible for the payment of Claimant's compensation benefits and correct the wrong that was started with the first WCJ. Since SWIF has already paid Claimant's benefits, the WCJ could order Employer to reimburse SWIF, thus putting SWIF back into the same financial position it would have been had the first WCJ not wrongfully ordered it to pay benefits. Id. at 702-03.