August 04, 2013

Carrier Not Permitted to Appeal IWCC Award

August 04, 2013

QBE Insurance Company v. Illinois Workers’ Compensation Commission No. 2013 IL App (5th) 120336WC

When QBE Insurance learned of an Arbitrator’s decision awarding compensation to Ronald Voges for a date of accident of October 14, 2010, it immediatelyfiled a review.  Unfortunately, QBE Insurance was not a party named on the Application for Adjustment of Claim Voges filed against his employer, G&S Foundry.  The Application was filed on January 28, 2010 and alleged that Voges had sustained accidental injuries to his hands, elbows, and upper extremities on May 12, 2009.  At the time of trial, Voges amended the Application to state an accident date of October 14, 2010 — afterthe original Application filing date.

The decision was filed on February 11, 2011.  QBE filed a petition for reviewon March 17, 2011; the employer filed a petition for reviewas well.  After filing the review, QBE filed a motion with the Commission requesting to be added as a ‘main party’ in the claim.  In support of this motion, QBE stated that when Voges amended his Application to allege an accident date of October 14, 2010, it brought the claim into the policy coverage period of QBE Insurance.  QBE did not receive notice of this change until after the hearing took place and proofs were closed.  QBE later filed a second motion, citing Section 4(g) of the Act, which permits an insurance company to be named a party to proceedings before the Commission where the employer has not paid compensation.  The Commissioner to whom the case was assigned permitted QBE to be named as a party to the case over Voges’ objection.

The Commission affirmed the Arbitrator’s decision awarding medical expensesand prospective medical treatment.  QBE filed a Request for Summons to review the Commission Decision; the employer appeared in this review proceeding when the Circuit Court confirmed the Commission Decision.  QBE filed a Notice of Appeal; the employer did not appeal.

The Appellate Court refused to consider the merits of QBE’s appeal.  Citing a lack of jurisdictionover QBE, the Court vacated the Commission’s Order granting the motion to add QBE as a named party to the claim.  First, the Court held that QBE did not have a right to be added as a named party pursuant to Section 4(g), as no provision in the Act provided for an insurance carrier to intervene in a Section 19(b)proceeding following an arbitration award.  Further, the Court refused to consider the equities, that QBE had never received notice of a claim during its policy period, stating,

“The purposes of the Act do not concern themselves with an insurer’s interests in intervention.  In fact, there is no provision in the Act that even requires notice to an insurance carrier of a workers’ compensation action against its insured.”

The Court thereupon dismissed QBE’s appeal and remanded the case to the Commission for further proceedings.

COMMENT

One laments the fate of QBE Insurance.  Not aware of a claim for an October 2010 accident and with its insured likely defended by another attorney, capable but nonethelessplaced inadvertently in a potential conflict of interest, QBE now has nowhere to turn for relief.  Its insured reported the claim to its carrier who, one assumes, assigned counsel to the case to defend against an alleged accident of May 12, 2009.  It is not known if the employer stipulated to a ‘new’ accident date some 17 months after the first, as much is left unsaid in this decision.

One fact is unassailable, however — there had been a change in coverage.  And once the employer did not appeal from the Circuit to the Appellate Court, QBE’s appeal would have been sure to fail, given that the employer had now accepted liability.  In all an untenable situation for QBE.  Granted that proceedings before the Commission are to be “simple in summary,” an amendment to an Application at time of trial may have serious due process implications.