They may have just messed with settlement contracts yet again. Can Illinois business ever finally settle the issues leading to a Section 4(c) Petition?
Editor’s comment: We are somewhat amazed, dazed and confused by this ruling. There is nothing technically “wrong” with the ruling and it isn’t a sweeping new change but, as defense observers, we can only shake our heads at what the members of the Court may have been thinking. We have to caution everyone on the defense side of the industry to modify settlement contract boilerplate language to protect your claims from the possible impact of this ruling. As part of your Illinois lump sum settlement contracts, we now suggest claimants be required to expressly waive rights under Sections 8(a), 19(h) and 4(c).
In Burzic v. Illinois Workers Compensation Commission (No. 1-08-2303 April 28, 2009), the Workers’ Compensation Division of the Appellate Court considered a claim where a Section 4(c) Petition was filed by claimant. The battle was over termination of vocational rehabilitation. If you read the decision, we feel the vocational counselor did a generally below-average job of what we call a “Plan B” vocational effort. If you need want specifics or need our thoughts on Plan A and Plan B in Illinois vocational counseling, send a reply.
In response to termination of vocational counseling, the employee then filed a 4(c) Petition attacking the insurer’s right to insure Illinois WC claims. The Section 4(c) Petition went to a full hearing with witnesses. The matter later settled for a lot of money. Settlement contracts were approved, probably by the same Commissioner who conducted the 4(c) hearing. Everyone in the Illinois defense industry would assume all pending workers’ compensation issues were over, right? Well, not so fast—remember this is Illinois!
Claimant continued to press the 4(c) Petition and actually demanded a ruling from the same Commissioner who approved the settlement contracts. The Commission panel contradictorily ruled they didn’t have jurisdiction due to approval of the settlement contracts and also denied the Petition. If you have any idea what “jurisdiction” means, you can’t do both. Claimant then appealed—we can imagine how happy the claims manager was to receive notice of appeal of the otherwise “settled” claim and the need to reserve legal fees to continue to manage an otherwise “closed” file.
Thereafter, the Cook County Circuit Court also demonstrated an unusual level of legal largesse by effectively doing the same thing the Commission did—the judge ruled the Commission didn’t have jurisdiction and affirmed the ruling the Commission didn’t have jurisdiction to enter.
The Appellate Court, Workers’ Compensation Division unanimously ruled the Commission retained jurisdiction of the Section 4(c) Petition despite the global settlement of all workers’ compensation rights. As we indicate above, we have no idea why they made such a ruling. The problem we all face is settlements in Illinois are traditionally supposed to bring complete closure to pending workers’ compensation claims. With respect to all of the august members of the Appellate Court, they keep sporadically leaving rights open and issues unanswered after settlements are approved.
In February 2009, another division of our Appellate Court ruled in Hagene v Derek Polling Construction, if one checks a box that “all medical bills are paid” by Respondent, Petitioner can eternally return to seek payment of medical bills that were otherwise unsubmitted and which the employer or the insurance carrier may have had no prior knowledge. We know the claims manager who got hit with that one and she is still hopping mad about it and we completely agree with her. So, ooops!—don’t check that box.
In this case, having found the settlement didn’t deprive the Commission of jurisdiction, the Court ruled dismissal of the petition was not against the manifest weight of the evidence because Section 4(c) petitions require proof of unfair handling of more than one claim. The Act requires demonstration of a “policy” of unfair handling so several claims have to be shown to be handled unfairly. As there was only one claim involved, the Petition was meritless.
However, the practical impact of the ruling the Commission retained jurisdiction of the Section 4(c) Petition despite the settlement means we now have to address such Petitions and be certain they are addressed in settlement contracts. One never knows when a zealous claimant files a 4(c) Petition. No one wants to pay to litigate such claims after settlement contracts are approved. So, our word to the wise is to be certain to address the issue in all settlement contracts moving forward.
One of our partners asked another obvious question—can one ever settle a claim to include the right to bring or join in a Section 4(c) Petition? Can the Arbitrators or Commission approve settlement contracts and close their files but then consider such petitions complaining of the actions of employers or insurance carriers in advance of the settlement? Our answer is no one knows—the decision in Burzic outlined above implies the Commission may always have “jurisdiction” to consider 4(c) petitions even if they settle and close the case. We assure our readers this sort of administrative confusion, unending litigation and uncertainty is a glaring reason Illinois is considered so anti-business in many circles.
If you have thoughts and comments, please send a reply. If you need the web site of the ruling, let us know.
