Judge's Benchbook:

Longshore & Harbor Workers' Compensation Act
Supplement - January 2005
Topic 14 - Payment of Compensation

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Payment of Compensation


    • Payment of Compensation--Controversion--Notice of Controversion


  • Compensation Paid Under Award


  • Employer Credit for Prior Payments




Topic  14.2.1  Payment of Compensation--Contoversion�Notice of Controversion


Hitt v. Newport News Shipbuilding & Dry Dock Co ., 38 BRBS 47 (2004).


            Overturning the ALJ, the Board found that when determining the validity of a notice of controversion, the document must be examined on its face. "[T]he information required and provided in the four corners of the document, standing alone, determined the validity of the filing�. Resort to other documents in order to divine employer's true intentions unnecessarily clouds the inquiry into employer's liability for a Section 14(e) assessment. Compliance with Section 14(d) in a timely manner is all that the statute requires of employer in order to avoid an additional 10 percent assessment." The Board held that as the employer filed a notice of controversion stating the reason for its controverting the claim, the employer complied with the requirements of Section 14(d).


            Noting the employer had tried to persuade the claimant to enter into a settlement on the same day that it controverted the claim, and for the degree of disability for which it was controverting the claim, the ALJ had concluded that the employer obviously did not dispute the extent of the claimant's impairment and controverted the claim only as a pretext to avoid the claimant's right to seek modification absent the issuance of an order.


            The Board noted that this matter occurred within the jurisdiction of the Fourth Circuit and that that court has stated that the validity of a motion for modification must come from the content and context of the [request for modification] itself� in order to ascertain whether the motion expresses an actual intent to seek compensation for a particular loss. The Board further noted that within the Fourth Circuit , the Board has held that consideration must be given to the circumstances surrounding the filing of a motion for modification, as well as to the content of the actual filing itself, in order to establish whether a valid motion for modification has been filed. However, the Board declined to extent this line of cases and require an ALJ to look beyond the four corners of a notice of controversion under Section 14(d) in order to determine its validity.

Topic  14.4     Payment of Compensation--Compensation Paid Under Award


Newport News Shipbuilding & Dry Dock Co. v. Brown , 376 F.3d 245( 4th Cir. 2004).


            An award under Section 14(f) for an employer's late payment of compensation is a successful prosecution of a claim for compensation for purposes of awarding attorney fees. The Fourth Circuit reasoned that the amount due for late payment satisfies the definition of "compensation" because it is a "money allowance payable" to the employee who is due the basic compensation award. "[W]hen the language of Sec. 14(f) is read together with the LHWCA's definition of compensation, and the Act's structural distinction between compensation and penalties is taken into account, it is plain that an award for late payment under Sec. 14(f) is compensation."

Topic  14.4     Payment of Compensation--Compensation Paid Under Award


Hanson v. Marine Terminals Corporation , 307 F.3d 1139 ( 9th Cir. 2002).


            The Ninth Circuit reversed federal district court decision which had denied Section 14(f) relief for overdue compensation on "equitable grounds." (Claimant had provided incorrect addresses on two occasionsat time of filing claim and when he submitted settlement for approval.) Agreeing with other circuits, the Ninth concluded that equitable factors have no place in the district court's consideration of a Section 14(f) penalty. The court noted that it need not decide whether fraud or physical impossibility would constitute a defense to a Section 14(f) penalty because neither fraud nor physical impossibility were at issue. The court simply stated that the statute limits the district court's inquiry solely to the question of whether the order was in accordance with law.

Topic  14.5     Payment of Compensation--Employer Credit for Prior Payments


Cooper/T. Smith Stevedoring Co. v. Liuzza , 293 F.3d 741 ( 5th Cir. 2002).


            The Fifth Circuit held that in view of the language of Section 14 and Congressional intent, the court's precedent addressing similar issues, and the deference owed the Director's interpretation, Section 14(j) does not provide a basis for an employer to be reimbursed for its overpayment of a deceased employee's disability payments by collecting out of unpaid installments of the widow's death benefits. In reaching this holding, the court referenced Oceanic Butler, Inc. v. Nordahl , 842 F.2d 773 ( 5th Cir. 1988). (An employer and insurer were not entitled to offset the disability settlement amount against liability to the employee's widow for death benefits.)