Which way is up?? Or who can we count on to paint the arrow on the package when deciding coverage issues??

In matters regarding only disputed coverage interpretations of an insurance policy which are an issue of pure contract law, the Appellate Court indicates they believe it is best left to the appropriate venue rather than the expertise of an Arbitrator or the Illinois Workers’ Compensation Commission. In Hastings Mutual Insurance Company v. Ultimate Backyard, in an appeal from the Circuit Court of Cook County, the Illinois Appellate Court, First District reversed and remanded an order denying a motion to stay proceedings and allowed the IWCC to interpret Section 4(b) of Workers' Compensation Act.

In Hastings, the insurer initially issued benefits under a WC policy after Petitioner sustained injury but then terminated benefits after the policy expired. It is undisputed the insurer complied with Section 4(b) requiring in pertinent part at least 10 day notice of cancellation. The insurer then sought to stay arbitration pending Circuit Court interpretation of the statute and insurance contract. The Circuit Court refused reasoning the IWCC was able to provide a specialized or technical expertise helping to resolve the controversy. It is important to note, the denial of a stay is treated as a denial of a request for a preliminary injunction, which is appealable under Rule 307(a)(1) using an abuse of discretion standard of review.

The Appellate Court reversed and remanded holding the mere interpretation of a statute and insurance contract is the type of issue the Circuit Court is well-versed in and not the type of question requiring the expertise of the IWCC. It was noted the Illinois legislature may vest exclusive original jurisdiction to an administrative agency, but it must do so explicitly through a comprehensive statutory administrative scheme, and the Workers' Compensation Act was insufficient to divest the Circuit Courts of jurisdiction.

In making their ruling, the Court noted factual issues were best left before the IWCC but indicated questions of law may be best left to the lower courts. Here, there was no question of fact regarding receipt of the notice because the notice was logged into a system and given a unique coding on the cancellation form indicating the date the form was received. The IWCC did not need to make any factual findings and the insurer contested the authority or jurisdiction of the IWCC to hear the case. Therefore, the Circuit Court should rule on questions of law when it could 'foreclose needless litigation.' Specifically, the determination the notice of cancellation met the statutory requirements of section 4(b) of the Workers' Compensation Act, relying on the undisputed fact the notice was logged and date stamped.

As a practice point, in situations where there is no dispute of fact but only of law, such as when there is a dispute whether the policy provides coverage to certain employees or to geographical locations, the insurer should contest the authority of the IWCC to hear the case with a motion to stay and immediately appeal any denial of said motion. A decision from an arbitrator or IWCC rather than the Circuit Court may dramatically affect the outcome of the case or frankly could simply extend litigation in both costs to the parties and in lengthening the entire process. Essentially, there is no need to waste the time of the IWCC by using their expertise and the Circuit Court is the appropriate venue to foreclose needless litigation. We had a similar case with a now-departed Arbitrator who made a coverage decision which was similar to this claim (almost the exact decision made by the Circuit Court in this case) and it resulted in almost two years of litigation including separate litigation over the entire coverage issue in a separate venue—all of which could have been avoided with a decision being made on the coverage issue.

This article was researched and written by Nathan Bernard, J.D. & Shawn R. Biery, J.D., MSSC who can be reached at nbernard@keefe-law.com or sbiery@keefe-law.com.

2-20-12; How “Non-Emergencies” May Sometimes Arbitrarily Become “Emergencies” in the Illinois Courts. While you are scratching your head about that one, remember Illinois taxpayers usually...

It is hard to truly blame this one on our courts. The Illinois Legislature and Governor have continued to bow to the demands of the wildly aggressive IL Firefighters Union and other public employee unions for years. In our view, this is another example of legislative inaction and ennui costing you and I millions in present and future taxes.

If you aren’t aware, sworn public safety employees such as police officers and/or firefighters in Illinois are entitled to lifetime “line-of-duty” disability benefits for injuries that do not prevent them from working and making money after leaving government employ. The legislature did a generally lazy job of not defining when a firefighter/police officer is entitled to such benefits—they used the quizzical term “catastrophically injured.” The legislature did nothing to further define this important qualifying term. Lots of folks might think “catastrophically injured” would and should mean the injured police officer or firefighter can never, ever work again in any capacity—in that setting a lifetime, line-of-duty disability pension makes sense to even the most conservative of our citizens.

Due to the lack of definition by the Illinois legislature, the courts took this ball and ran with it to magically define the term “catastrophically injured” to mean the police officer/firefighter can no longer work in their current public safety capacity, even if they can work in private industry and make a decent living at the same or higher wages than they made in public service. We are seeing lots and lots of liberal rulings where mildly injured public safety employees can retire early on great benefits due to what we feel aren’t truly disabling conditions, like the firefighter with the runny nose and watery eyes.

On top of that, what lots of folks also don’t know is a firefighter or police officer entitled to a line-of-duty disability pension may also qualify for lifetime family healthcare coverage on the taxpayers’ dime if a few factual requirements are met. In most parts of our state, this annual cost is probably well over $25,000 per year. For a forty-year-old firefighter, the projected lifetime cost to the taxpayers is well into the millions. Please also note we are not aware of any limitations on such coverage—a single firefighter entitled to lifetime family healthcare coverage might later apply for it for a second or third marriage and children who weren’t present at the time of their public service and injury. Again, the legislature didn’t rein it in and we can’t truly expect the courts to take action where our lawmakers are creating confusion and uncertainty.

In order to be entitled to lifetime family healthcare coverage, the firefighter has to injured responding to an “emergency.” Like the ambiguities above, the Illinois legislature was waaaay too busy tossing out our tax dollars to define “emergency.” So the question arises, what if a firefighter is injured during regular training but is told to act like it is an “emergency” when it clearly isn’t? How can you have an emergency in training when everyone knows it isn’t “emergent” but an exercise set up by management?

In Gaffney v. Board of Trustees of the Orland Fire Protection District, the Illinois Supreme Court considered two consolidated cases. Our highest court decided procedural and substantive questions arising under Sec. 10 of PSEBA or the Public Safety Employee Benefits Act. Both cases involved injuries incurred during routine firefighter training exercises.

Plaintiff Gaffney was injured in a live-fire exercise retracing the route of a hose in order to clear it from an obstruction. Plaintiff Lemmenes was injured in a simulation of fire conditions while wearing a blacked-out firefighter's mask. As their injuries were “career-ending” and incurred in the line of duty, they received line-of-duty pensions. In these cases, they also sought the additional benefits provided by Sec. 10(a) of the Act of the payment of future family health insurance premiums. The Circuit Court judge in Gaffney concurred with the denial of benefits by the fire protection district, and the Appellate Court affirmed. The denial of benefits by the Fire Protection District to Lemmenes was reversed by the trial court and the appellate panel affirmed.

PSEBA provides for these benefits in four factual settings. The setting implicated was if the injury occurred as the result of the firefighter's "response to what is reasonably believed to be an emergency." The Act offers no definition or direction as to how the decision is to be made, nor does it provide for administrative review. The Supreme Court held the proper vehicle for judicial determination of entitlement to benefits is through an action for declaratory judgment. The action of the Fire Protection Districts was viewed by the Court as “an employer's objection to paying Sec. 10 benefits."

The Supreme Court majority concluded the meaning of "emergency" is an unforeseen circumstance involving imminent danger to a person or property requiring an urgent response. The Court noted public safety employees are required to respond to emergencies, "whether they are real or not." The majority concluded Plaintiff Gaffney injured in the environment of a “live fire” exercise was entitled to benefits but Plaintiff Lemmenes was not entitled to benefits in his non-fire setting, with no unforeseen circumstances.

Justice Garman's concurring/dissenting opinion raises numerous questions concerning both the statutory meaning derived by the majority and the application of the meaning to the facts of the cases. His opinion objected to the grafting of the entire definition of "emergency" from a specific dictionary onto the statute without, in the view of that opinion, further consideration of the full context of the statute as giving additional understanding of the intent of the legislature. His opinion would find the additional benefits to be proper when the firefighter is injured "while responding... to a circumstance that he reasonably believes poses imminent danger to another person or property and that requires an urgent response." Paragraphs 101 and 102 of the dissent indicate why this is potentially an enormous expansion of PSEBA. This decision can be interpreted to mean that an emergency can occur when a public safety officer is alone completing routine tasks, as long as it is “unforeseen” and involves a dangerous situation. The danger need not be a danger to the public, but need only be a danger to the individual public safety officer. Whether or not a danger exists is not determined by any objective criteria, but by the subjective belief of the individual involved.

With respect to the august members of our court, we are dissatisfied with the whole legislative and judicial process. The Illinois legislature and reviewing courts shouldn’t leave such issues open to interpretation—there is too much at stake. At present, it is our view it is going to be literally impossible to tell when a public safety officer might or might not be eligible for this multi-million dollar lifetime benefit. There is too much at stake to leave it all open to random interpretation. The only thing we can be certain of is lots of litigation and uncertainty and more costs to already strapped government budgets.

We thank the reader who sent us news of this ruling. We seek your thoughts and comments. Please feel free to post them on our award-winning blog or you can LiveChat about it—information on LiveChat is on our website; see below.

2-14-12; In drug/alcohol testing, can we test saliva and will it stand up?

If you aren’t sure, the 2011 Amendments to the Illinois Workers’ Compensation Act made intoxication a much stronger defense to workers’ compensation claims than in the past. Effectively, alcohol use at levels over the driving limit create a presumption of intoxication that needs to be rebutted by claimant. Use of illegal drugs or non-prescribed drugs should create a similar presumption. The problem this creates for employers is creating and maintaining valid tests. Please remember the more serious the claim, the more important testing becomes—you have maintain a chain of custody and otherwise insure scientific testing occurs.

We had a reader ask us if saliva can be tested and used to establish intoxication in Illinois, Indiana, Michigan and Wisconsin testing. The answers are various.

The Drug Testing Advisory Board now recommends the Substance Abuse and Mental Health Services Administration include oral fluid as an alternative specimen in the Mandatory Guidelines for the Federal Workplace Drug Testing Programs. In addition, they have added several prescription drugs to the panel for review (e.g., oxycodone, oxymorphone, hydrocodone and hydromorphone) in the Mandatory Guidelines for Federal Workplace Drug Testing Programs.

 From that recommendation, we are suggesting clients who want to test for drug and alcohol use also obtain backup saliva testing. Saliva testing has a

·         Shorter up-front window of detection.

·         All collections are monitored at the point of collection with little to no chance of adulteration.

·         Simple collection procedure with no requirement for same-gender collectors or specific collection site needs.

·         No known successful court challenges

Problems with the concept include:

·         Shorter overall window of detection.

·         Limited laboratory availability within the US for workplace testing and confirmation of NIDT.

·         No federal procedures in place to use as guideline.

·         All positive saliva tests, whether by non-instrumented drug test devices or by laboratory based drug testing, must be confirmed using GC/MS or GC/MS MS confirmation testing.

·         For saliva testing, there is no difference between heavy use and current use, unlike with urine testing where the marijuana may be detected for several weeks in a heavy user.

We remain happy to assist our clients with drug testing issues in the states where we provide services, including IL, IN, MI and WI. If you have questions or need help, please send a reply.