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CNA Insurance Co. v. Sliski3/15/2001
Hampden.
December 4, 2000.
Workers' Compensation Act, Double compensation, Serious and wilful misconduct of employer, Insurer. Statute, Construction. Public Policy.
Civil action commenced in the Superior Court Department on June 18, 1993.
The case was heard by C. Brian McDonald, J.
The Supreme Judicial Court on its own initiative transferred the case from the Appeals Court.
In this declaratory judgment action, CNA Insurance Companies (CNA) seeks to establish that it is not responsible to an injured worker for payment of double compensation under G. L. c. 152, ? 28, of the workers' compensation act (act) for the alleged serious and wilful misconduct of the worker's employer because the employer is insolvent and unable to repay CNA as provided in the statute. A judge in the Superior Court concluded that CNA must pay the double compensation and entered a final declaratory judgment to that effect. CNA appealed and we transferred the case to this court on our own motion. We affirm the judgment.
1.
On June 9, 1988, when James Sliski was eighteen years old, he fell through an elevator shaft at work and suffered spinal injuries that left him a paraplegic. At the time of his injuries, Sliski was employed by Doane & Williams, Inc. (Doane & Williams), which was insured by CNA. CNA accepted liability for Sliski's injury and commenced payment of weekly workers' compensation benefits pursuant to G. L. c. 152, ? 34.
Sliski alleged that his injuries were the result of serious and wilful misconduct by Doane & Williams, and on March 23, 1989, he filed with the Department of Industrial Accidents (department) a claim for double compensation pursuant to G. L. c. 152, ? 28. Notice of the claim was given to both CNA and Doane & Williams, but the record does not indicate what, if any, action was taken on that claim. In 1991, Doane & Williams ceased to do business, and its assets were sold in lieu of foreclosure by a secured creditor. On June 2, 1992, Sliski refiled his claim for double compensation. CNA filed a denial of the refiled claim on June 5, 1992, and subsequently filed with the department a motion to dismiss, raising the statute of limitations and laches as defenses, and claiming that it was not liable for payment of double compensation to Sliski because its insured had become insolvent. An administrative judge in the department denied the motion on June 8, 1993. Sliski's ? 28 claim remains pending before the department and has been stayed pending the outcome of this action.
2.
CNA argues that, because double compensation is available to an employee only on a showing of serious and wilful misconduct by the employer, the purpose of the provision is to punish the employer and to deter other employers from engaging in such misconduct. To require CNA to make such payments to Sliski with no possibility of repayment by Doane & Williams, it argues, defeats the punitive purpose of the statute, violates the public policy against providing insurance coverage for punitive damages, and violates its due process rights. It likens the ? 28 double compensation to multiple damage awards for a wilful and knowing violation of G. L. c. 93A, ?? 9 and 11, which we have acknowledged are avowedly punitive. Kapp v. Arbella Mut. Ins. Co., 426 Mass. 683, 686 (1998).
The language of the statute suggests that the purpose of ? 28 is to benefit an injured worker, not to punish the employer, for it describes the double payments as "extra compensation." G. L. c. 152, ? 28. See Hoffman v. Howmedica, Inc., 373 Mass. 32, 37 (1977) (statutory language principal source of insigh
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