Columbus & Southern Ohio Elec. Co. v. Indus. Comm. - Ohio Supreme Court Opinion - Ohio Supreme Court Decision

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OPINIONS OF THE SUPREME COURT OF OHIO
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Columbus & Southern Ohio Electric Company et al.,
Appellees, v. Industrial Commission of Ohio et al., Appellants.
[Cite as Columbus & Southern Ohio Elec. Co. v. Indus.
Comm. (1992), Ohio St.3d .]
Workers' compensation -- Self-insured employer's right to
handicap reimbursement vests, when -- Term
"assessments" as used in R.C. 4123.343(F), construed.
1. A self-insured employer's right to handicap
reimbursement vests when the Industrial Commission
determines a causal relationship between the handicap
and the injury or disability which entitles the
employer to handicap reimbursement for that claim.
2. The term "assessments," as used in R.C. 4123.343(F),
includes all assessments that a self-insured employer
pays to the Bureau of Workers' Compensation, but does
not include compensation or benefits paid to the
handicapped employee.
(No. 91-445 -- Submitted April 7, 1992 -- Decided July 1,
1992.)
Appeal from the Court of Appeals for Franklin County, No.
89AP-444.
Plaintiffs-appellees Columbus & Southern Ohio Electric
Company and Southern Ohio Coal Company are self-insured
employers under the Workers' Compensation Act of Ohio. On
August 11, 1987, appellees filed a declaratory judgment action
against defendants-appellants Industrial Commission of Ohio
("the commission") and James L. Mayfield, Administrator, Bureau
of Workers' Compensation, seeking a clarification of their
right to handicap reimbursement under R.C. 4123.343(F). R.C.
4123.343(F) was amended on August 22, 1986 to cap the amount of
annual reimbursement a self-insured employer could recover.
141 Ohio Laws, Part I, 718, 745. Specifically, appellees
alleged that the commission's application of amended R.C.
4123.343(F) to handicap reimbursement claims arising before the
effective date of the amendment was a violation of Section 28,
Article II of the Ohio Constitution, R.C. 1.48, and R.C. 1.58.
Appellees also sought clarification of the word "assessments"
as used in R.C. 4123.343(F) and as interpreted by the
commission in Ohio Adm.Code 4121-3-28.

The trial court held that the amendments to R.C. 4123.343
became effective on January 1, 1987, and that the cap may not
be applied to reimbursements requested before that date. The
trial court also held that "assessments" means all assessments,
not just handicap assessments, against a self-insured employer
in any calendar year, but not including the employer's actual
payment of compensation or benefits.
The court of appeals reversed with respect to the date of
effectiveness, holding that amended R.C. 4321.343 became
effective on August 22, 1986, and that the cap did not apply to
handicap reimbursement applications filed before that date.
The court of appeals affirmed the trial court with respect to
the meaning of "assessments."
The cause comes before the court on a motion to certify
the record.

Porter, Wright, Morris & Arthur and Charles J. Kurtz III,
for appellees.
Lee I. Fisher, Attorney General, and Gerald H. Waterman,
for appellants.

Herbert R. Brown, J. This case requires us to determine
(1) when a self-insured employer's right to handicap
reimbursement vests, and (2) the meaning of "assessments" as
used in R.C. 4123.343(F). For the reasons which follow, we
hold that an employer's right to handicap reimbursement vests
when the commission determines that the employer is entitled to
handicap reimbursement for a particular claim, and that
"assessments" means all assessments made against a self-insured
employer, but does not include compensation or benefits paid to
an employee.
I
Vested Right to Handicap Reimbursement
The General Assembly enacted R.C. 4123.343 in 1955 to
encourage employers to employ and retain handicapped persons.
126 Ohio Laws 947. Pursuant to the statute, the commission
reimburses or credits an employer, totally or partially, for
compensation and benefits paid to a handicapped employee who is
industrially injured and whose handicap contributed to the
injury or resulting disability. R.C. 4123.343(B) and (C); see,
also, State, ex rel. American Seaway Foods, Inc., v. Indus.
Comm. (1991), 62 Ohio St.3d 50, 51, 577 N.E.2d 1085, 1086.
On August 22, 1986, the General Assembly amended R.C.
4123.343 to cap the amount of annual reimbursement an employer
could recover. The amendment provides in pertinent part:
"(F) No employer shall in any year receive credit under
this section in an amount greater than the premium he paid if a
state fund employer or greater than his assessments if a
self-insuring employer." Am.Sub.S.B. No. 307 (141 Ohio Laws,
Part I, 718, 745).
The parties dispute the application of R.C. 4123.343(F)'s
cap on handicap reimbursements. The commission and the
administrator maintain that the cap creates an annual ceiling
which an employer's cumulative handicap reimbursements cannot
exceed regardless of the date the commission adjudicated any
particular claim. Appellees, on the other hand, argue that a
self-insured employer's right to full reimbursement vests when

the handicapped employee was hired, or, alternatively, when the
injury occurred.
Subsequent to the parties' appeal and initial briefing in
this case, we released our opinion in State, ex rel. American
Seaway Foods, Inc., v. Indus. Comm., supra, in which we held
that R.C. 4123.343(F) may not be applied to handicap
reimbursement claims in which the commission had determined an
employer's right to reimbursement before August 22, 1986. In
Seaway, we rejected the employers' argument that the right to
reimbursement vests at the time of injury because reimbursement
is "contingent on the commission's determination that the
requisite causal relationship exists between the handicap and
the injury or disability. Absent that finding, there is no
reimbursement right." Id., 62 Ohio St.3d at 53, 577 N.E.2d at
1087.
After we announced our decision in Seaway, appellees moved
to amend their argument on this issue. Appellees now urge us
to modify our position in Seaway and hold that the right to
handicap reimbursement in a particular claim vests at the time
the employer files the application with the commission for
reimbursement. Appellees contend that Seaway does not address
cases in which a self-insured employer had filed an application
for handicap reimbursement with the commission prior to August
22, 1986, but where the commission did not adjudicate the claim
until after that date. We are not persuaded to overrule Seaway.
An application for handicap reimbursement, like the
occurrence of the injury itself, is no guarantee that the
employer is entitled to handicap reimbursement. Regardless of
when the employer files the application, the commission must
determine whether there is a causal relationship between the
handicap and the injury or disability before an employer is
entitled to handicap reimbursement under R.C. 4123.343.
Accordingly, we hold that a self-insured employer's right
to handicap reimbursement vests when the commission determines
a causal relationship between the handicap and the injury or
disability which entitles the employer to handicap
reimbursement for that claim. Therefore, the cap contained in
R.C. 4123.343(F) applies to claims for handicap reimbursement
where the application was made before August 22, 1986, but
where the commission's determination that the employer was
entitled to reimbursement occurred after that date.
II
Assessments
R.C. 4123.343(F) provides that an employer cannot receive
handicap reimbursement in any year in an amount greater than
"the premium he paid if a state fund employer or greater than
his assessments if a self-insuring employer." (Emphasis
added.) The parties dispute the meaning of the term
"assessments" as it limits the amount of credit to which a
self-insuring employer is entitled.
The commission promulgated Ohio Adm. Code 4121-3-28(G),
which provides:
"No employer shall in any rating year receive credit under
section 4123.343 of the Revised Code in an amount greater than
the premium it paid if a state fund employer or greater than
its handicap assessments if a self-insuring employer."
(Emphasis added.)

As an administrative agency, the commission may promulgate
rules and regulations governing its activities and procedures
as long as the rules are not unreasonable and do not conflict
with statutes that cover the same subject matter. State, ex
rel. DeBoe, v. Indus. Comm. (1954), 161 Ohio St. 67, 53 O.O. 5,
117 N.E.2d 925, paragraph one of the syllabus. Appellees argue
that the commission's rule, limiting available reimbursements
to the amount of "handicap assessments," conflicts with R.C.
4123.343(F). We agree.
R.C. 4123.343(F)'s reference to "assessments" is
unqualified. Under the Workers' Compensation Act, the
administrator calculates assessments against self-insured
employers for: (1) the intentional tort fund created pursuant
to R.C. 4121.80,1 (2) administrative costs, (3) the safety and
hygiene program, (4) that portion of the surplus fund not used
for handicap reimbursement, and (5) that portion of the surplus
fund used for handicap reimbursement. R.C. 4123.35(I). The
cap in R.C. 4123.343(F) limits the total amount that an
employer may receive for handicap reimbursement; it does not
limit the kind of assessments that are included in calculating
that amount. Furthermore, R.C. 4123.343(F) refers to
assessments in the plural. Had the General Assembly intended
to limit a self-insured employer's reimbursements to the amount
of handicap assessments, it could have done so.
Accordingly, we hold that the term "assessments," as used
in R.C. 4123.343(F), includes all assessments that a
self-insured employer pays to the Bureau of Workers'
Compensation, but does not include compensation or benefits
paid to the handicapped employee.
Judgment affirmed in part
and reversed in part.
Moyer, C.J., Sweeney, Douglas, Wright and Resnick, JJ.,
concur.
Holmes, J., concurs in paragraph one of the syllabus and
in the judgment.

FOOTNOTE:
1 R.C. 4121.80 was declared unconstitutional in toto in
Brady v. Safety-Kleen Corp. (1991), 61 Ohio St.3d 624, 576
N.E.2d 722, paragraph two of the syllabus.