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07/10/97 HERAEUS ELECTRO NITE COMPANY AND STATE

July 10, 1997

HERAEUS ELECTRO NITE COMPANY AND STATE WORKMENS' INSURANCE FUND, PETITIONERS
v.
WORKMEN'S COMPENSATION APPEAL BOARD (ULRICH), RESPONDENT



Appealed From No. A94-2663. State Agency, Workmen's Compensation Appeal Board.

Before: Honorable James Gardner Colins, President Judge, Honorable Joseph T. Doyle, Judge, Honorable Doris A Smith, Judge, Honorable Rochelle S. Friedman, Judge, Honorable James R. Kelley, Judge, Honorable Jim Flaherty, Judge, Honorable Bonnie Brigance Leadbetter, Judge. Opinion BY Judge Flaherty. Judge Leadbetter concurs in the result only.

The opinion of the court was delivered by: Flaherty

OPINION BY JUDGE FLAHERTY

FILED: July 10, 1997

Heraeus Electro Nite Company (Employer) petitions for review of the order of the Workers' Compensation Appeal Board (Board) *fn1 which affirmed the decision of the workers' compensation Judge (WCJ) awarding benefits to Dolores Ulrich (Claimant) based solely on her claim petition (petition). We affirm.

On May 6, 1993, Claimant filed a petition with the Department of Labor and Industry, Bureau of Workers' Compensation (Department) requesting compensation and payment of medical bills pursuant to the Act. In this petition, Claimant alleged she was suffering from lung disease in the form of "asthma, chronic bronchitis, emphysema, COPD and/or aggravation of such conditions" as a result of exposure to various elements during the course of her work for Employer. (R.R. at 1a.) Claimant alleged that she ceased working on March 23, 1992, as a result of these work-related injuries, and/or the aggravation thereof. Id.

On or about June 14, 1993, the Department served a copy of the petition and a notice of assignment via first class mail, postage pre-paid, on Employer. *fn2 These papers were not returned by postal authorities as undeliverable. At the October 28, 1993, hearing before the WCJ, Claimant's counsel moved that the matter be decided on the basis of the petition as Employer failed to timely file an answer. The WCJ directed the parties to submit letter briefs and exhibits to support their respective arguments regarding the motion by Claimant's counsel.

In evaluating the reasons for a late filing, to determine whether the employer can establish an adequate excuse, a WCJ must evaluate the matter on a case by case basis. See Metro Ambulance v. Workmen's Compensation Appeal Board (Duval), 672 A.2d 418 (Pa. Commw. 1996). After reviewing the parties submissions and evidence here, the WCJ availed himself of the rebuttable presumption of service provided in Section 406 of the Act, and concluded that Employer was properly served on or about June 14, 1993. *fn3 Although the Department never served a copy of the petition on Employer's correct insurance carrier, the State Workers' Insurance Fund (Insurer), *fn4 the WCJ, having prior knowledge of Insurer's facsimile number, took judicial notice that, on July 13, 1993, Employer sent a facsimile copy of the petition to Insurer. Insurer mailed an answer to the petition on August 5, 1993, which was received by the WCJ on August 9, 1993.

The WCJ found that Employer failed to file its answer within fifteen days after the date it was served by the Department, as required by Section 416 of the Act. *fn5 Moreover, the WCJ found that Employer had no justifiable excuse for failing to timely file its answer (which was due on June 29, 1993). The WCJ also determined that Insurer's answer was filed on August 9, 1993, more than fifteen days after it received the facsimile copy of the petition from Employer and more than fifteen days from the date Employer was served by the Department, and that it had no justifiable excuse for filing a late answer. Employer presented no evidence relating to liability other than a letter brief and an affidavit asserting that the answer filed should have been found to be timely.

Because of these facts, the WCJ deemed all the allegations in the petition admitted in accordance with Section 416 of the Act, found that Claimant sustained her burden of proof and awarded benefits. *fn6 Employer appealed to the Board, which affirmed the WCJ's decision but modified Claimant's compensation rate. Employer now appeals to this court.

On appeal, Employer questions whether the Department's failure to serve a copy of the petition and notice of assignment on Insurer constitutes improper service justifying the late filing of an answer, and whether Claimant met her burden of proving all the elements necessary to support an award of ongoing compensation without presenting additional evidence besides the allegations set forth in her petition. *fn7

Employer argues here that the Department's failure to mail a copy of the petition and notice of assignment to Insurer constitutes defective service. Thus, Employer avers that an adequate excuse for the late filing of the answer under Section 416 of the Act exists and, therefore, it should be permitted to present evidence in rebuttal of the claim.

Section 414 of the Act provides that "the department shall serve upon each adverse party a copy of the petition, together with a notice that such petition will be heard by the referee to whom it has been assigned . . . ." 77 P.S. § 775. The Board's regulations define the term "party" to include a "claimant, defendant, employer, insurance carrier, additional defendant and, if relevant, the Commonwealth." 34 Pa. Code § 131.5. Section 305(a)(1) of the Act states that an "insurer shall be entitled to all of the employer's liability hereunder and shall be entitled to all of the employer's immunities and protection hereunder." 77 P.S. § 501. Therefore, in accordance with the above, Employer contends that the Department was required to directly serve Insurer.

We agree with Employer that Insurer is an adverse party within the meaning of Section 414 of the Act and, thus, the Department was under a statutory mandate to serve Insurer. However, not every failure by the Department to properly serve an adverse party automatically results in ...


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