Midas Recovery Servs., Inc. v. Workers' Comp. Appeals Bd.

Opinion

VOGEL (C. S.), P. J.

Introduction

Petitioner, Midas Recovery Services, Inc., seeks a writ of review from the findings and award and order of a workers’ compensation judge determining

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that petitioner, a lien claimant seeking reimbursement for disability benefits paid to an injured worker, was not entitled to the benefit of the provisions of Labor Code section 4661.5.

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Petitioner also seeks review of the order of the Workers’ Compensation Appeals Board denying its petition for reconsideration. We find that the order of the workers’ compensation judge and the board’s order denying reconsideration were in error. Having issued a writ of review, we now annul the decision of the board.

Factual and Procedural Background

Lavell Crawford sustained psychiatric and other injuries during the period of October 1989 to October 1990 in the course and scope of his employment by California Federal Bank. It was later stipulated by the parties that he was temporarily totally disabled from March 24, 1991, to August 10, 1992. However, when Crawford filed a claim for benefits in November 1990, the claim was denied by his employer. The employer, through its insurance company CNA Insurance Companies, did not pay workers’ compensation benefits at that time. If paid during that period, the employer’s payments would have been at the rate of $266 per week.

However, Crawford’s long-term disability provider, Phoenix Home Life Insurance Company, paid him benefits exceeding $448 per week for the period of March 24, 1991, to August 10, 1992. As of July 1994, petitioner became the assignee of Phoenix Home Life Insurance Company for the purpose of seeking reimbursement of the disability payments made by Phoenix. In that capacity, petitioner filed a lien in the amount of $32,064, pursuant to section 4903.1, for reimbursement of the disability payments made by Phoenix.

In August 1995, the workers’ compensation judge approved a settlement by compromise and release between Crawford and respondents in the amount of $65,000. As part of the compromise and release, it was agreed that petitioner’s lien was to be paid, adjusted, or litigated separately. The parties agreed that the period of reimbursement covered March 24, 1991, to August 10, 1992, but could not agree on the applicable weekly rate. The matter went to trial on January 29, 1996. Petitioner contended that it was entitled to the rate in effect at the time payment of the lien would be made, or $448 per week, pursuant to section 4661.5, since it had been two years since the date of injury. Respondent argued that the rate in effect during the period of temporary disability, or $266 per week, applied instead, and that section 4661.5 was inapplicable.