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                                     BRB No. 00-1143

ALFONZO DAVIS                           )
                                        )
          Claimant-Petitioner           )
                                        )
     v.                                 )
                                        )
DELAWARE RIVER STEVEDORES               )    DATE ISSUED:   07/26/2001   
                                             
                                        )
     and                                )
                                        )
LIBERTY MUTUAL INSURANCE                )
COMPANY                                 )
                                        )
          Employer/Carrier-             )
          Respondents                   )    DECISION and ORDER

     Appeal of the Decision and Order Awarding Benefits of Ainsworth H.
     Brown,  Administrative Law Judge, United States Department of Labor.

     Aloysius J. Staud (Fine and Staud), Philadelphia, Pennsylvania, for
     claimant.

     John E. Kawczynski (Field Womack & Kawczynski), Jersey City, New Jersey,
     for employer/carrier.

     Before: SMITH and DOLDER, Administrative Appeals Judges, and NELSON,
     Acting Administrative Appeals Judge.

     PER CURIAM:

     Claimant appeals the Decision and Order Awarding Benefits (2000-LHC-1033) of
Administrative Law Judge Ainsworth H. Brown rendered on a claim filed pursuant to
the provisions of the Longshore and Harbor Workers' Compensation Act, as amended,
33 U.S.C. §901 et seq. (the Act).  We must affirm the administrative
law judge's findings of fact and conclusions of law if they are supported by
substantial evidence, are rational, and are in accordance with law.  33 U.S.C.
§921(b)(3); O'Keeffe v. Smith, Hinchman & Grylls Associates, Inc., 380
U.S. 359 (1965).  

     Claimant sustained a work-related injury to his right knee on March 4, 1999,
when he suffered a fall on a ship. The administrative law judge found that claimant
presented sufficient evidence to invoke the presumption at Section 20(a)  of the
Act, 33 U.S.C. §920(a),  and that employer did not establish rebuttal thereof. 
The administrative law judge found that employer had constructive notice of the
accident when it occurred since it was witnessed by claimant's foreman, who
notified his supervisor, although a written record was not made as required by
internal company policy. Alternatively, the administrative law judge found that
employer did not establish that it was prejudiced by the lack of formal notice of
the accident. See 33 U.S.C. §912(d).  The administrative law judge
awarded claimant temporary total disability benefits from March 4, 1999 to January
5, 2000, and medical expenses.  The administrative law judge denied claimant a
penalty under Section 14(e) of the Act, 33 U.S.C. §914(e), because claimant's
counsel raised the issue for the first time in his post-hearing brief.  

     On appeal, claimant alleges that the administrative law judge erred in denying
a Section 14(e) penalty.  Employer responds, urging affirmance and contending that
the parties stipulated that employer filed a timely notice of controversion.

     Claimant correctly contends that the administrative law judge erred in the
instant case by refusing to consider his entitlement to a Section 14(e) penalty. 
 Generally, it is within  the administrative law judge's discretion to consider
whether he will allow a new issue to be raised for the first time before he issues
his decision, 20 C.F.R. §702.336(b); Delay v. Stevedoring Services of
America, 31 BRBS 197 (1998), especially when the issue is raised  in violation
of the administrative law judge's pre-hearing order. See generally Durham
v. Embassy Dairy, 19 BRBS 105 (1986).  Nonetheless, an assessment pursuant to
Section 14(e) is mandatory, when applicable, Newport News Shipbuilding & Dry Dock Co. v.
Graham, 573 F.2d 167, 8 BRBS 241 (4th Cir.), cert. denied, 439 U.S. 979 (1978); Garvey Grain Co. v.
Director, OWCP, 639 F.2d 366, 12 BRBS 821 (7th Cir. 1981), aff'g Cuellar v. Garvey Grain Co., 11 BRBS
441 (1979), as the statute states that such an assessment "shall" be made. 33 U.S.C. §914(e).   Thus, the Board has
held that the issue of the applicability of Section 14(e) may be raised at any time. See, e.g., Scott v. Tug Mate,
Inc., 22 BRBS 164 (1989) (raised by claimant for first time on appeal); Burke
v. San Leandro Boat Works, 14 BRBS 198 (1981) (raised by Director in response brief to Board).  Claimant, therefore,
could raise a Section 14(e) issue for the first time in his post-hearing brief.  Accordingly, we vacate the denial of a Section
14(e) assessment, and we remand this case to the administrative law judge for further proceedings.

     Section 14(e) states: 

     If any installment of compensation payable without an award is not paid
     within fourteen days after it becomes due, as provided in subdivision
     (b) of this section, there shall be added to such unpaid installment an
     amount equal to 10 per centum thereof . . . .

33 U.S.C. §914(e).  Compensation is due on the fourteenth day after employer
has been notified of the injury pursuant to Section 12 of the Act, 33 U.S.C.
§912, or has knowledge of the injury, 33 U.S.C. §914(b), unless employer timely
controverts claimant's right to compensation.  33 U.S.C. §914(d).  In this case, the parties stipulated that employer
filed a notice of controversion on August 31, 1999, and the administrative law judge accepted this stipulation. 
Decision and Order at 2.  The parties also stipulated that the notice of controversion was timely filed.  This stipulation was
not referenced by the administrative law judge in his decision, and in fact, is belied by the administrative
law judge's finding that employer had knowledge of claimant's injury on March 4, 1999. See id. at 6;
Scott, 22 BRBS at 168 (employer's knowledge under Section 14(b) is determined by using the same standard
employed under Section 12(d)).

     On remand, the administrative law judge must address claimant's entitlement to a Section 14(e) penalty
in light of the parties' stipulations and his findings regarding employer's knowledge of claimant's injury.  The
administrative law judge must give the parties notice if he is not going to accept their stipulations and the
opportunity to submit evidence in support of their positions, see Dodd v. Newport News Shipbuilding & Dry
Dock Co., 22 BRBS 245 (1989), but he may not accept a stipulation that evinces an incorrect application of the law,
see Pucetti v. Ceres Gulf, 24 BRBS 25 (1990).   Employer's liability
for a Section 14(e) penalty ceases on the date employer files its notice of
controversion or an equivalent document, or when the Department of Labor knows of
facts that a proper notice of controversion would have revealed. See Matulic v.
Director, OWCP, 154 F.3d 1052, 32 BRBS 148(CRT) (9th Cir. 1998); Hearndon v. Ingalls Shipbuilding, Inc.,
26 BRBS 17 (1992); Scott, 22 BRBS at 169; Caudill v. Sea Tac Alaska
Shipbuilding, 22 BRBS 10 (1988).

     Accordingly, the administrative law judge's Decision and Order Awarding
Benefits is  vacated insofar as it declines to address the applicability of 
Section 14(e), and the case is  remanded to the administrative law judge for
further findings consistent with this decision.  The Decision and Order is affirmed
in all other respects.

     SO ORDERED.





                                                                   
                         ROY P. SMITH
                         Administrative Appeals Judge



                                                                   
                         NANCY S. DOLDER
                         Administrative Appeals Judge



                                                                   
                         MALCOLM D. NELSON, Acting
                         Administrative Appeals Judge

NOTE: This is an UNPUBLISHED LHCA Document.

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