WCLA MCLE

1
WCLA MCLE

• Smalley Steel Ring What Happens When the
  Petitioner Is Not Who He Says He Is
• Mark P. Matranga, Wiedner McAuliffe
• Wednesday August 5, 2009
• 1200 noon to 100 pm
• James R. Thompson Center Auditorium, Chicago, IL
• 1 hour general MCLE credit

2
Issue

• Does the Arbitrator have the authority to recall
  his decision, reopen proofs and issue a second
  decision when it is subsequently discovered that
  Petitioner used a false identity to obtain
  benefits in the Arbitrators first decision?

3
Workers Compensation Act

• Section 19(b) Unless a petition for review is
  filed by either party within 30 days after the
  receipt by such party of the copy of the
  decisionthen the decision shall become the
  decision of the Commission and in the absence of
  fraud shall be conclusive. 820 ILCS 305/19(b)
• Section 19(f) The decision of the Commission
  acting within its powers, according to the
  provisions of paragraph (e) of this Section
  shall, in the absence of fraud, be conclusive
  unless reviewed as in this paragraph hereinafter
  provided. However, the Arbitrator or the
  Commission may on his or its own motion, or on
  the motion of either party, correct any clerical
  error or errors in computation within 15 days
  after the date of receipt of any award by such
  Arbitrator or any decision on review of the
  Commission and shall have the power to recall the
  original award on arbitration or decision on
  review, and issue in lieu thereof such corrected
  award or decision. Where such correction is made
  the time for review herein specified shall begin
  to run from the date of receipt of the corrected
  award or decision. 820 ILCS 305/19(f)

4
Previous Interpretations

• Michelson v. IC, 375 Ill. 462 (1941) The
  Commission does not have the authority to set
  aside its decisions on the basis of fraud
  without express authority, the Commission does
  not have jurisdiction to act and the parties are
  relegated to a Court of equity for relief under a
  charge of fraud.
• Wilson-Raymond v. IC, 79 Ill.2d 45 (1980) There
  is no provision for recall or reconsideration of
  a decision other than that provided in Section
  19(f).
• Ming Auto Body v. IC, 387 Ill.App.3d 244 (2008)
  The clear and unambiguous language of Section
  19(f) does not authorize an Arbitrator or the
  Commission to reopen and set aside a prior final
  decision, even where it is asserted that the
  award is based on fraud.

5
Harry Diaz v. Smalley Steel Ring04WC041924

• 7-09-2004 DA
• 8-31-04 Harry Diaz files Application alleging
  injury to his left arm
• 4-07-05 Arbitrator Erbacci awards Petitioner
  Harry Diaz medical and TTD on 19(b)
• 5-10-05 Respondent files Emergency Motion to
  Recall Decision Reopen Proofs
• 5-13-05 Arbitrator conduct hearing on Motion and
  reopens proofs
• 8-23-05 Arbitrator conducts hearing and hears
  additional evidence about Petitioners use of
  false ID
• 9-1-05 Commission considers and denies Petition
  for Penalties for failure to pay award
  (05IWCC0979)
• 11-15-05 Arbitrator issues second decision
  denying benefits

6
Diaz v. Smalley Steel Ring06IWCC0947

• Petitioner files Review
• Commissioners Sherman Dauphin, 10-30-06
• The Commission agrees with the Petitioners
  position that the Arbitrator did not have the
  statutory authority (i.e. jurisdiction) to recall
  his final decision, to reopen proofs, and to
  issue a second decision relying on Sections
  19(b) and 19(f)
• Cites Michelson
• Different from a Motion to Reopen before a
  decision is issued by the Arbitrator Roberts v.
  Bridgestone, 02IIC663 and Radulescu v. LSG,
  03IIC884

7
Smalley Steel Ring v. IWCC386 Ill.App.3d 993,
900 N.E.2d 1161, 326 Ill.Dec.914 (2008)

• Confirmed by Circuit Court of Lake County,
  06MR1535, Honorable Mary S. Schostok
• Unanimous Appellate Court decision (McCullough,
  Gordon, Grometer, Holdridge Donovan, 12-12-08)
  affirms Commission
• The Act expressly provides for recall of an
  Arbitrators decision in only one instance, i.e.,
  to correct clerical or computational errors. The
  Arbitrator did not have the statutory authority
  to act and, therefore, was without jurisdiction
  to recall his decision, reopen proofs and issue a
  second decision. The Commission was correct in
  its assessments and its decision should not be
  overturned on review.
• Employer may seek recourse for claimants
  fraudulent conduct. The appropriate forum for its
  allegations is in the circuit court. More
  specifically, we note Section 25 of the Act
  expressly provides for criminal penalties and
  civil liability in the event of fraudulent
  workers compensation claims.
• Such deficiencies in the Act should be addressed
  by the legislature.

8
Questions

• What does in the absence of fraud mean?
• What does conclusive mean?
• Can parties waive, release or settle Section 25.5
  fraud provisions?
• When is a case final?
• What should the legislature do to address the
  deficiencies pointed out by the Appellate
  Court?